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The surplus note is a good idea in theory. Private companies can purchase private reinsurance and remain viable. That said, I would look into established carriers looking to diversify before offering such a note to a start-up.
Catch 22- The National Companies need to be invited back into the State with no fear of accessments. Citizens needs to go back to Wind Only policies and give the market back to the Companies. But it won’t happen. Whoever heard of a Government Agency being terminated.
Without a viable plan to stop new policies from coming into Citizens, these options would be limited in their effectiveness.
It’s great that United wants to takeout policies and increase the premium 10% each year. But is there anything to stop the insured from going back to Citizens in three years if the premium is lower? That happens on takeout policies all the time right now. Citizens has yet to take any serious measures at reducing new business. Even the measures they’ve taken to cut coverage hasn’t reduced demand because the cuts have lowered premiums. In a crappy economy, people are premium driven. They’ll risk that their screen enclosure might blow away and have no coverage.
Just today, I lost a policy on a 2012 home. $250k in coverage – frame construction. Private market was $1800. Another agency placed them with Citizens for $1300. Why the hell is Citizens beating the private market by $500? Why are they even offering coverage on 2012 homes??
Our agency has worked hard to get our carrier appointments and keep them in good standing with low loss ratios. We deserve to have an edge over an agency that only offers one market and Citizens. If a home qualifies for the private market, it should not be eligible for Citizens, period.
I don’t know customer sentiment in your part of the state Hillsborough. I know in my agency the vast majority of people will avoid Citizens in any way possible. For those who want to insure their new construction with the government, well, I’d rather see them go to another agent. After their claims experience they’ll be back to see me.
Mr. Solvent: It seems like there is no in between up here. People either want to be properly insured with a good carrier and are willing to pay, or they just want the cheapest possible. Even the reasonable people can be swayed by a $500 savings with citizens tho. When consumer confidence in the economy is low, they’re willing to take a bit more risk to keep some money in their pockets.
I agree with you on letting them go to another agency but we don’t just lose the homeowners in that situation. We lose a shot at the auto, flood, umbrella, etc. It’s hard to tell an agent to let that walk out the door because of Citizens.
I’d like to give Citizens underwriters access to the quoting systems of other carriers. If they get a quote with another carrier, you better have a good explanation for why you placed it with Citizens or you get a binding violation. Three strikes and you lose your Citizens appointment. Wanna control Citizens growth? that’ll do the trick.
This sounds like sour grapes as an agent you need to express to the customers their option and never make decissions for them yes guide them on better choices but if you did not show them their option of Citizens you did not earn their business and obviously the other agent did the only edge is good communictions with your insured as far as loss ratio I am happy to hear that your angency is blessed with a good loss ratio but I dout seriously if you or your agency had any thing to do with that how could you pick a place to insure where they are less likly to have a fire or a theft
It’s about picking good customers. who you market to. What business you accept and what business you refer out to another agency.
That’s how you get your loss ratios down. If you will take any business and try to cram it with any market that will accept it, your loss ratios will be pretty high.
Therein lies the issue we the agents see everyday. The smaller agencies or captive agents are driving these newer homes to Citizens because they themselves don’t offer other options and of course without a “little push from lawmakers” these agents will never educate their clients/prospects that THEY only have Citizens and the client may be better served shopping for a private carrier. We too see that literally every week, homes you just ask yourself “what is Citizens doing insuring this home”. Makes absolutely zero sense. Gotta love government run entities!
Southern Family take-out carrier (Poe Financial Group) = was given $10M by RPCJUA (Citizens predecessor) for taking out 100,000 policies in a depopulation scheme not unlike the ones currently being pitched = became the 6th largest P&C insolvency in history after 2004/05 hurricane seasons = and yet here we go again!
This is like TARP bail out money = don’t just give it away, invest it and get equity share in and profit split with the companies that plan to write more business using Citizens funds. Then, even if they die after a storm, at least Citizens shared in the profits for the years leading up to that point.