Citizens Property Insurance Corp. Shrinks Its Footprint
As Florida moves past a particularly active hurricane season, the state-backed insurer of last resort, Citizens Property Insurance Corp., continues to reduce its policy count. This shift, largely attributed to legislative reforms aimed at curbing litigation, has significant implications for Florida homeowners.
Anne Geggis is the insurance reporter at The Palm Beach Post.
Legislative changes in 2021 and 2022 are credited with stabilizing the property insurance market. While increased competition is expected to eventually lower prices, experts anticipate stabilization, potentially with slight decreases.
The main effect of this shift has been on Citizens itself; Private insurers are now more willing to take on customers in traditionally high-risk areas. According to officials, Palm Beach, Broward, and Miami-Dade counties account for the largest numbers of policyholders moving away from Citizens.
Tim Cerio, Citizens’ president and CEO, described the situation as “really unique” due to the combination of reduced lawsuits and more private companies willing to take on risk.
Fewer Policies, Reduced Exposure
Citizens expects to have just over half the number of policyholders it had when Florida’s property insurance market was in turmoil. As the insurer of last resort, Citizens steps in to cover properties private companies deem too risky. Historically, areas like Monroe, Broward, Palm Beach, and Miami-Dade counties saw a high concentration of Citizens’ policies.
“Companies have an appetite for these regions because the litigation is really down,” Cerio said, also identifying Hillsborough and Orange counties as areas where private insurers are now entering the market.
These five counties account for over half the policyholders who have transitioned to private insurance. Dropping 478,000 policyholders in 2024, primarily along the tri-county coast, means Citizens will save around $370 million in reinsurance costs.
By the end of 2025, Citizens projects to have 738,000 policyholders, down from 1.4 million in September 2023. This size will make State Farm Insurance, Florida’s second-largest insurer, only 15% smaller than Citizens, assuming State Farm’s figures from late last year hold steady.
Legislative Impact and Hurricane Season
Cerio largely credited the Florida Legislature and Governor Ron DeSantis for the changes in the property insurance industry. Alterations to insurance regulations and tort laws in 2021 and 2022 have reduced the incentive for policyholders to sue their insurers in settlement disputes.
This past hurricane season, which saw three hurricanes make landfall in Florida, was the first since these regulatory changes. Fewer lawsuits have emerged from the claims.
Lawsuits against insurers peaked in 2021, with nearly 100,000 filed. In 2024, the number dropped to 57,120, the lowest since 2017.
Cerio noted that, “Trends are moving in a very positive direction in terms of claims that actually enter into litigation.”
What This Means for Homeowners
Ryan Papy of Keyes Insurance reported similar interest in the tri-county area from insurance carriers. He does not expect Florida to cease being one of the most expensive states for property insurance.
“We are seeing a lot more options, and over time, options will lead to better prices,” Papy said. “Right now, though, the best we can hope for is that they (prices) stabilize and maybe go down a little bit.”
The audit committee of the Citizens’ Board of Governors received updates on claims from the 2024 storms, all of which hit Florida’s Gulf Coast. As of December 31:
- Hurricane Milton, a Category 3 storm, cost Citizens $2.07 billion in claims, significantly less than the $3.89 billion predicted by models.
- Hurricane Helene, a Category 4 storm, cost $315 million, also less than anticipated.
- Hurricane Debby, a Category 1 storm, cost $76.5 million.
None of the storms triggered payments from Citizens’ reinsurance.
This shift in the insurance landscape may bring more stability to Florida’s property insurance market. However, homeowners should still monitor changes and consult with insurance professionals to understand the impacts on their policies.
