Florida Citizens Property Insurance

hurricane winds     A non-profit insurance company, Florida Citizens Property Insurance Corporation was created in 2002 in a law passed by the State Legislature. It was right after Hurricane Andrew devastated the southern part of the state that Florida Citizens Property Insurance Corporation was established.

A combination of two companies, Florida Citizens Property Insurance is aimed at providing insurance coverage for homeowners in high-risk areas. Also, Florida Citizens Property Insurance provides policies for those homeowners who are unable to find coverage from the private insurance market.        

            The two companies that make up Florida Citizens Property Insurance are the state-run insurance entities, Florida Residential Property and Casualty Joint Underwriting Association (FRPCJUA) and the Florida Residential Windstorm Underwriting Association (FWUA).

            Before the creation of Florida Citizens Property Insurance, property owners had a difficult time finding insurance companies that are willing to offer them insurance coverage for damages or losses due to hurricanes and windstorms. These two natural disasters are especially common in the state since Florida is located near the Pacific. To give property owners the coverage that they need, Florida Citizens Property Insurance was created.

             Since the implementation of the law that created Florida Citizens Property Insurance, the company how holds over eight thousand policies for state residents. This makes Florida Citizens Property Insurance the second largest insurer of the state.

            Susanne Murphy, the chief operations officer for Florida Citizens Property Insurance Corporation said a in a recent interview that their “growth has been explosive for the past 18 months.”

The truth of her statement was cemented when Florida Citizens Property Insurance Corporation released a report, saying that they cover up to $192 billion in property. The months of August to December in 2002 saw Florida Citizens Property Insurance writing a total of 606,215 policies. At the same time, Florida Citizens Property Insurance had a liability of $2,400,020,398.

The astounding growth of Florida Citizens Property Insurance was attributed to several factors. The volume of Florida Citizens Property Insurance policies have significantly increased due to the new developments in coastal areas. The reluctance of other insurance companies to write new policies for homeowners in Florida has also contributed much to the number of Florida Citizens Property Insurance policyholders to rise.

More recently, Florida Citizens Property Insurance Corporation experienced a major setback when the four hurricanes hit the state. The hurricanes Charley, Frances, Ivan, and Jeanne has cost Florida Citizens Property Insurance Corporation an estimated $1.77 billion in total damages. This net loss estimate of Citizens Property Insurance Corporation was first reported by Risk Management Solutions.

To overcome the loss, Florida Citizens Property Insurance has increased the premium price of their windstorm policy up to 67 per cent. This move by Florida Citizens Property Insurance has resulted in a surplus that reaches up t o $1.2 billion. Also, Florida Citizens Property Insurance is expected to earn $40 million monthly in premium incomes.

However, despite this seeming surplus in their funds, executives at Florida Citizens Property Insurance are not certain whether they are going to have a deficit. The total number of claims that Florida Citizens Property Insurance has to answer to numbers close to 92,000. And according to Risk Management Solutions, this number is still expected to rise within the next few months.

Leave a Reply