A Leon County, Fla. circuit judge has approved putting three financially-troubled insurance companies under the state’s control, a move Florida’s Chief Financial Officer Tom Gallagher said will protect more than 320,000 Floridians this hurricane season. The insurance companies, Atlantic Preferred, Southern Family and Florida Preferred, are subsidiaries of the Tampa-based Poe Financial Group.
“My priority is to ensure policyholders have continuous coverage this hurricane season, and we’ve achieved that,” Gallagher said. “Now our focus is resolving outstanding hurricane claims.”
Circuit Court Judge Janet Ferris signed liquidation orders for all three insurers and appointed the Department of Financial Services as receiver. As receiver, the department takes control of the companies’ operations and liquidates the companies’ assets to pay outstanding claims.
Gallagher, who oversees the department, said that since Southern Family and Atlantic Preferred entered rehabilitation April 25, the department has already paid more than $76 million in outstanding claims for both companies. When an insurance company is in rehabilitation, the department oversees its operations to protect resources to ensure claims get paid.
Under the liquidation orders, homeowners who are currently covered by one of the three Poe companies and who are unable to secure new homeowner’s coverage in the private market will be automatically covered by Citizens Property Insurance Corp. July 1. Gallagher said a formal plan for smoothly transitioning policyholders to Citizens will be presented for the court’s approval by Friday.
Gallagher said effective June 1, the department will be able to tap into the Florida Insurance Guaranty Association to help resolve outstanding claims. FIGA is funded by insurers with written premiums in the same lines of coverage.
Southern Family covered nearly 43,000 homeowners and condominium and homeowners’ associations. Atlantic Preferred and Florida Preferred primarily provided coverage to approximately 280,000 homeowners, mostly in South Florida.
Source: Florida Department of Financial Services