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Despite persisting challenges, Florida’s property insurance market shows improvement amid reforms


Florida’s property insurance market is showing signs of stabilization, as discussed in a roundtable led by CFO Jimmy Patronis, with legislative reforms and industry efforts beginning to reduce litigation costs and lower homeowner insurance rates.


Florida’s property insurance market, long plagued by challenges such as high litigation costs and frequent natural disasters, was the focus of a roundtable discussion on Thursday led by Chief Financial Officer Jimmy Patronis.

The meeting, featuring state legislators, insurance regulators, and industry representatives, aimed to address and mitigate the factors driving up homeowner insurance costs in Florida.

Patronis opened the roundtable by outlining the state’s efforts in legislative reform designed to stabilize the insurance market. He cited recent measures that have curtailed excessive litigation — a significant factor in rising insurance premiums. Patronis specifically cited Senate Bill 2D, signed during a 2022 special session, and drafted to reduce frivolous litigation by reserving attorney fee multipliers, requiring proof that an insurer breached its agreement with a policyholder before a lawsuit can be filed, and preventing insureds from transferring their unilateral right to receive attorneys’ fees to contractors.

“Whether its the [Florida] Legislature in December 2022 [taking] aggressive steps to change the legal environment in the state of Florida, I’ve told people ever since that, when those changes [were] made, we needed 12 to 18 months for their corrections to take effect. And here we are at month fourteen and we’re having carriers that are starting to drop rates,” Patronis said.

Office of Insurance Regulation Commissioner Michael Yaworsky provided insight toward the insurance rate-setting process, highlighting regulatory commitments to maintain actuarially sound rates while noting that ensuring rates are neither inadequate nor unfairly discriminatory serve as pivotal metrics in stabilizing the market.

Yaworsky described the rate setting process as meticulous and data-driven, involving the analysis of actuarial data to ensure rates are sufficient to cover potential claims. In Florida, where natural disasters like hurricanes frequently threaten, roughly 45 percent of premium revenue is immediately allocated to reinsurers, he said, with the remaining funds used to cover claims and manage administrative costs.

“We continue to see rate pressure relieving, we continue to see rate adequacy coming in, and we have multiple companies that have filed for an actual overall rate decrease,” Yaworsky said. “We have many companies that are beginning to see some stability in the marketplace and importantly, because this is a cost that goes directly to consumers, much of it goes directly to consumers, the cost of reinsurance, and the global reinsurance market.”

This month, three Florida property insurance companies announced rate reductions aimed at providing some relief to homeowners. Florida Peninsula Insurance is reducing rates by 2 percent for more than 122,000 policies, while Slide Insurance Company and Florida Family Insurance Company are both seeking a 0.5 percent decrease. The decreases, seen as a positive step by industry experts, comes as Citizens, the state-backed insurer, reports a significant financial turnaround and a reduction in policy count through depopulation.

During the event, Citizens CEO Tim Cerio pointed to the company’s improved financial stability and its efforts in reducing the number of policies through a strategic depopulation process, which involves transferring policies to private insurers to mitigate risk and liability. As of this writing, Citizens has offloaded approximately 400,000 lines of policy to the private marketplace.

Cerio also addressed the impact of recent legislative reforms designed to stabilize the market by reducing the prevalence of frivolous lawsuits and other cost-driving abuses. Looking ahead, he expressed optimism about the future, crediting both the legislative measures and Citizens’ ongoing initiatives aimed at further reducing policy counts and bolstering financial health.

“We had a very successful depopulation season in 2023,” Cerio said. “Because the market is recovering, insurance insurers are willing to come in and invest and take policies out of citizens last year.”

Patronis also brought attention to the “My Safe Florida Home” program, which funds improvements that enhance home resistance to hurricanes. Participants credited the initiative, along with legislative reforms with beginning to decrease insurance premiums and litigation-related costs.

This week, Gov. Ron DeSantis signed a pair of bills into law that increases funding for the My Safe Florida Home program and extends its coverage to include condominiums. The measures allocate an additional $200 million to the program while simultaneously restricting the Department of Financial Services from accepting new applications or creating a waiting list once the funds are exhausted, ensuring a cap on the program’s commitments. Lawmakers amended the initial drafting of the bill, increasing the provisional funding from $107 million to the approved $200 million.

“When you have those type of improvements on your home, an insurance carrier, is less likely [to believe] that household is going to file a claim,” said Patronis. “That means I can charge less than premium because it’s not going to have as many vulnerabilities.”

Tasha Carter, Florida’s Insurance Consumer Advocate, spoke on her office’s role in protecting policyholder rights and the importance of educating Floridians about insurance policies and claims processes stating that her focus is on empowering homeowners to navigate the insurance system effectively.