At the height of the crisis surrounding property insurance in Florida, big insurance companies were exiting the Florida market complaining that the risk they faced from potentially massive storm damage claims was too great, given the rates they were allowed to charge. In response, many of the people who lost coverage had little alternative to Citizens Property Insurance, the state-backed insurer of last resort.
While this was happening, we suggested what was needed was a set of conditions that would lure private insurers back to Florida, because Citizens Property’s growing risk burden was unsupportable, especially in light of the Legislature’s decision to limit the rate increases Citizens could impose.
At the time, we and others suggested that what was needed was a return of private insurers to Florida to help Citizens Property shoulder its growing load. The response to this suggestion from some quarters was that private insurers had fled the state and wouldn’t return, and suggesting they might was somewhat naive.
Maybe not. According to an article in The Tampa Tribune, state insurance regulators have received requests from nine property insurers seeking rate reductions, and four have already been granted. Some insurers, to be sure, are seeking rate increases; the rate reduction requests are seen as a sign that the Florida property insurance market is stabilizing. Jake Holehouse, a St. Petersburg insurance agent, said interest in the Florida market from private insurers is growing.
The property insurance market in Florida has been a mess, and we’re nowhere near being out of the woods. Still, given the size of the problem, we’ll take any signs of progress.