Lawmakers closer to allowing takeout offers to Citizens' policyholders
They are called surplus-line companies, including Lloyd's of London

Article Courtesy of Channel 5 WPTV

By Matt Sczesny

Published March 1, 2024


WEST PALM BEACH — Florida lawmakers seem to be moving closer to allowing more insurance companies to make offers to Citizens' homeowner policyholders of vacation and second homes.

SB 1716 this week cleared the Senate's Fiscal Policy Committee for the takeout offers.

Earlier this month the Senate's Banking and Insurance Committee approved the measure.

The bill would allow surplus line insurers to start making takeout offers to Citizens' policyholders who have second and vacation homes.

Citizens has been involved for the last year with an effort to have private insurers make these offers to try to shed policies and its financial exposure to claims.

Surplus line insurers operate differently than traditional or admitted insurance companies in the state and they are regulated differently.

"These are companies headquartered and domiciled outside of the United States," Paula Blanda, a Florida insurance agent known as "The Insurance Lady," said.

Florida lawmakers seem to be moving closer to allowing more insurance companies to make offers to certain Citizens' policyholders.

Blanda said one example of a surplus line insurer is Lloyd's of London.

"We often refer to our excess and surplus companies as the folks who insure when other people won’t," she said.

The surplus line companies do have ratings, which consider things like how much reinsurance they are carrying, she said.

If approved, the number of homes facing the surplus line takeouts is expected to be below 100,000.

The bulk of Citizens' take-out offers are still with single-family homes in Florida. With houses and condos, those takeout offers can be refused if the offer is over 20% of what policyholders are currently paying with Citizens.