- Tailrow Insurance Company has been approved by the Florida Office of Insurance Regulation to become an authorized insurer in the state, which will help to slow the exodus of policy writers leaving Florida’s property insurance market.
- Tailrow is the first company to be allowed in as an authorized insurer since the passing of Senate Bill 2-A and Senate Bill 2-D.
- Tailrow will serve as a subsidiary of HCI Group, Inc., which announced an intent to enter the Florida property insurance market earlier this year.
Tailrow Insurance Company has been approved by the Florida Office of Insurance Regulation (OIR) to become an authorized insurer in the state, slowing the exodus of policy writers leaving Florida’s property insurance market.
The approval of Tailrow’s application marks the first company to be allowed in as an authorized insurer since the passing of Senate Bill 2-A and Senate Bill 2-D. The pair of bills, among other things, sought 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.
At the time of the signings, Florida homeowners paid nearly three times higher than the national average for home insurance, according to the Insurance Information Institute, partly as a result of the relatively large number of insurers that have left the state. At the start of the current calendar year, 15 insurers were deemed insolvent since 2020, leaving Floridians with a dwindling number of
“OIR’s greatest priority is to promote a stable and competitive insurance market for consumers. Today’s announcement is great news for Florida policyholders who will benefit from having additional options when shopping for homeowners insurance,” said Insurance Commissioner Michael Yaworsky. “As we begin to see the impacts from recently passed legislation, OIR will continue to use all available resources to attract more insurance-related companies, jobs, and capital to the Florida insurance market.”
The final approval and issuance of Tailrow Insurance Company’s Certificate of Authority will be contingent upon the company following all provisions in the agreement with the OIR.
Per the OIR consent order, Tailrow will allocate $300,000 toward meeting the agency’s mandatory deposit requirements, which also mandates that Tailrow establishes a catastrophe loss model with plausible maximum loss projections for a once-in-a-century event.
Tailrow’s will serve as a subsidiary of its parent company HCI Group, Inc., which announced earlier this month that it intended to establish a new domestic homeowners insurance service in Florida.
The motion of approval comes as a series of remaining property insurers — Citizens Property Insurance Corp., Kin Interinsurance Network, and First Community Insurance Co. — requested the Office of Insurance Regulation (OIR) to approve their proposed rate increases for the upcoming Fiscal Year.
In late March, the Citizens’ Board of Governors internally sanctioned a proposal that grants organizational leaders the opportunity to petition the OIR for authorization to implement a 14.2 percent hike in insurance expenses.
According to the group, the recommended rates for 2023 call for a statewide average increase on all personal lines policies including homes, condominium units, dwellings, renters, and mobile homes due to inflation in the construction market.
Specifically, homeowner policy rates would increase by an average of 13.9 percent while condo owners would see an average 14.6 percent increase. If approved by the Office of Insurance Regulation, the 2023 rates would go into effect for new and renewal personal residential policies beginning November 1.
Later that week, both Kin Interinsurance Network and First Community Insurance Co. appeared before the OIR seeking authorization to increase rates. First Community sought an average 44.8 percent increase for homeowner multi-peril policies, while Kin filed for an average 61.5 percent increase on such policies.
Moreover, insurance holders in Florida will begin to experience a one percent rate hike in October due to an emergency assessment approved by the Florida Insurance Guaranty Association (FIGA). The assessment is an additional fee charged by FIGA on its members to raise funds for the payment of covered claims linked to the liquidation of United Property & Casualty Insurance Company.
The state Office of Insurance Regulation imposed a similar one percent emergency assessment on all covered lines of business except auto, meaning that all insurance companies in Florida, except for auto insurance, will also be charged the extra one percent fee.