HCI Group to assume 53,750 Citizens policies on Tuesday

by | Nov 20, 2023

  • HCI Group, through its subsidiary Homeowners Choice Property & Casualty Insurance Company, is slated on Tuesday to assume approximately 54,000 policies from Citizens Property Insurance Corporation, accumulating $196 million in premiums.
  • The transfer, approved by the Florida Office of Insurance Regulation, is part of a broader initiative to move policies from the state-backed Citizens to private insurers, with HCI’s TypTap Insurance Company set to assume more policies in the future.
  • The Florida Office of Insurance Regulation has also authorized the transfer of up to 125,000 additional policies from Citizens to four other insurance companies in January.

Effective Tuesday, HCI Group will assume nearly 54,000 policies from Citizens Property Insurance Corporation, bringing approximately $196 million in premiums to its portfolio.

The acquisition was conducted through HCI’s subsidiary, Homeowners Choice Property & Casualty Insurance Company, following approval from the Florida Office of Insurance Regulation in September. Of the 75,000 policies Homeowners Choice was authorized to assume, it made offers to 72,958 and garnered a 74 percent acceptance rate, according to the company. HCI plans to expand further, with another subsidiary, TypTap Insurance Company, set to assume more policies from Citizens in the coming months.

“Homeowners Choice has completed the transition of a significant number of policies that were previously identified by our technology as attractive policies for assumption. The strong acceptance rate was the result of Homeowners Choice offering policyholders a competitively priced renewal policy and expanded coverage compared with their existing Citizens policy,” said Paresh Patel, HCI’s chairman and chief executive officer.

On Nov. 1, Florida regulators gave the green light for four insurance companies to assume up to 125,000 policies from Citizens in January. The orders, signed off on by Commissioner Michael Yaworsky allow the transfer of policies as part of an ongoing “depopulation” initiative, a program designed to transition policies from Citizens to private insurance companies.

Slide Insurance Co. will have the opportunity to take on up to 75,000 policies, Florida Peninsula Insurance Co. is set for 30,000, Edison Insurance Co. and US Coastal Property & Casualty Insurance Co. are both approved for 10,000 each. This information was detailed on the Florida Office of Insurance Regulation website.

Florida’s state-backed Citizens Property Insurance Corp., in the middle of an explosive growth in policies, announced earlier this year that it would begin complying with an Office of Insurance Regulation (OIR) directive to start offloading hundreds of thousands of homeowner policies to private insurers. Crafted by the Florida Legislature, the plan facilitates private insurance companies in the state to assume policies held by Citizens.

In the first half of 2023, OIR approved 91,000 policies for transition, with an additional 184,000 granted and transferred in October.

Over the last three years, Citizens has seen a surge in its policy count due to various private insurers pulling back and increasing rates due to financial strain. At the end of October, Citizens reported 1.331 million policies, a dip from 1.412 million earlier in the month. The decrease is attributed to the transfer of 99,773 policies to five private insurers in mid-October as part of the depopulation strategy.


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