The largest property insurer in Florida is set to cut hundreds of thousands of insurance policies due to overwhelming demand, handing over policies to private insurance carriers.
The Citizens Property Insurance Corporation, created by the Florida Legislature, is set to cut over 600,000 policies within the next two months. Specifically, the insurer will hand over 413,808 policies to 10 private insurance carriers in late October and cut a further 235,035 policies in November.
The cut comes after Citizens, which holds 1,250,791 policies in Florida as of August 2024, said the transfer came due to the overwhelming demand. The insurer's policies soared in recent years after other private insurers in the state dropped customers and raised rates due to losses caused by payouts.
For perspective, Citizens only had roughly 420,000 active policies in August 2019, per Newsweek.
What Should Homeowners Expect
Homeowners whose policies will be handed over to other insurers may see an increase in premiums, according to Click Orlando. It is unclear how much the increase would be. The state currently caps this hike at 20%.
Many homeowners are still left wondering how to manage the cost, especially in Florida where the average insurance premium costs $10,996. It is predicted to increase by 7% to $11,759, Insurify reported. In comparison, the average annual rate of insurance premiums in the US is $2,377.
A New Storm Is Coming
Citizens' depopulation comes just as a new Category 5 storm known as Hurricane Milton is on track to barrel through Florida on Wednesday. That storm currently has wind speeds reaching 180 miles an hour and is set to become the strongest storm in the Gulf of Mexico in nearly 20 years, per the New York Times.
Evacuations are being ordered in many counties in Florida, including Charlotte, Citrus, Collier, Glades, Hernando, Hillsborough, Lee, Manatee, Miami-Dade, Okeechobee, Pasco, Pinellas, Sarasota, and Volusia.
Hurricane Milton comes less than two weeks after Hurricane Helene tore through Florida, causing flooding across parts of the southeastern US. The storm killed 20 people in the state as of Saturday. It is unclear how much damage Helene caused.
