The only way this will work is if they get a substantial rate increase. most of this book is new construction with hefty wind mit discounts and the premium does not cover the reinsurance costs due to the location of the risk. I hope they got a really good deal because much of this business is already being moved because of the uncertainty of Edison’s future. Fl. Peninsula’s way of doing business with agents is not that appealing and the compensation plan sucks. It is one of the lowest out there and that is why the bulk of business is take out policies. Hope the can make it work or it will be what kills them.
Florida Pen’s compensation plan isn’t the best out there. They compensate for it with an easy to use system, fair underwriting guidelines, and they accept credit cards.
As for Edison’s book, it is mainly newer homes. Whether the premium justifies reinsurance is another story. I’m certain it does but because you’re talking about a company that had only 25,000 policies, there was too much overhead to see a profit. We’ll see what happens.
FPI my not be a national carrier, but they seem to always be doing decent things for the industry and the State. There are many companies to complain about; I don’t think FPI is one of them.
Thats right it is a pretty big ponzi isnt it? The only reason there is 70 Million in surplus is the State says they must maintain it to write this amount of premium. The plan for all these carriers is to get the premiums high enough for the the big payday when they strip the company of all cash and turn it over to DOI or FIGA when the wind blows.
None of the start up carriers are looking for longevity in the financial aspect of runing the companies. Grab the money and run through your MGA or management company is the usual business plan. It Looks to be a very big payday for the stockholders of the MGA or management company.
Bill, you don’t have a clue about what you’re talking about. Magnolia is an example of a company that was allowed to write a similar amount of premium with only $20 million in surplus. Florida Peninsula adds to their surplus each and every year. What do you notice about those that go insolvent? Surplus decreases while premium increases. Get a grip man.
That comment was just irresponsible and ridiculous. We started as agents for Florida Peninsula. In 2007, and have never had any problems. They were started by big company guys and have always told us – and shown us – that they were here to stay. They have a great agency interface for quoting and endorsements, although the commission rate is just ok. Not every company is fly by night.
the only reason a carrier would add to its surplus is to allow for growth or pay claims for future growth. surplus to written premium is pretty important to a carrier who wants to write more premium. My only question is why would this carrier want to write more premium in florida. If it is to stay in business why isnt Nationwide expanding or State Farm, or Allstate writting more business at the same crazy rates as these fly by nights in Florida. The reason is to get as much money in the company to strip it later. That is the same business model of the 5 start ups to go insolvent last year in Florida.
Mr. Solvent, By the way I have a better grip on this situation than you do. The 20 Million was not surplus it was a loan to start up the company. Here is the pres release discussing the effects of these small start ups in Florida on the market by the association of insurance carriers
Consider Magnolia Insurance. It has been approved by state regulators to take up to 120,000 policies out of Citizens. If it does take the entire load, it will catapult itself from zero to among the 10 largest private insurers in the state. So far, it has taken out just over 45,000.
Magnolia is headed by H. James Irl, who used to run Florida Insurance Premium, whose license he surrendered when he began to work on forming the new firm. The $20 million start-up capital came from a $23.8 million LOAN from Allianz Risk Transfer, a New York subsidiary of Allianz AG, an international insurance, banking and asset management company based in Zurich.
I bet if you were able to see Mr. Irl’s bank account now, it would show the 20 million in surplus you said it had, plus and Allianz was paid back its 20.3 million LOAN to capitalize the ponzi scheme.
Why wouldn’t they want to grow in Florida Bill? There’s plenty of profitable business to be had for a reasonable company. Why would a company like Universal Insurance Company of North America with an AM Best rating grow? ASI? Florida Family?
Of the 23 million used to startup Magnolia, $20 was put into policyholder surplus.
You didn’t address any of my concerns Bill. You are a joke, not an insurance agent.
Coral- Showed declining surplus and increasing premium before failure.
American Keystone- Showed declining surplus and increasing premium before failure.
Magnolia- Showed declining surplus and increasing premium before failure.
You can’t just state an opinion and blanket it over all companies. There are plenty of Florida only companies who are in it for the long haul. Does Tower Hill ring a bell with you? How many years have they been here?
Universal Insurance Company of North America with an AM Best rating grow? ASI? Florida Family?
ALL MINOR LEAGE CARRIERS AT BEST. NO PUN INTENDED.
Where are the real carriers. All on the bench. Why because stupid agents dont demand more out of Crist and McCarty playing politics with our industry.
It is our job to properly advise our clients on the true threat to them by having there insurance written through a fly by night carrier and FIGA having a $300K cap on what it will pay in the event of a catastrophe and your clients will be at your door wanting an good explaination as to why you wrote their homeowners with Mutual of Oh My God.
Good luck with that scenario. I am wanting to fix this issue before it happens. Lets find a way to create an incentive for the good carriers to come back to Florida and by the way they pay 15% commissions. Sound good? it does to me.
Solvent, OK so not all florida based carriers are a ponzi. but 90% are!
You didnt answer my concern? If Florida such a profitable place to do business and reasonable carriers should do business here, then why isnt State Farm, Allstate, Nationwide, Auto Owners, Met Life Home and Auto, Atlantic Mutual Ins. Co. Hartford, Travelers, Safeco, Firemans Fund, Liberty Mutual, Cincinati, Harleysville Mutual,or any other A+X best rated carrier or better willing to write business here. Why have they all chosen to stay away from writing $300K homes for $900. a year in Florida and your wonderful carriers are falling all over themselves to do it? Huh….
Bill what you’re proposing isn’t a bad idea. The issue is what we’re to do in the meantime. You can do any of the following as an agent:
1) Refuse to sell Homeowner’s policies.
2) Dump your homeowners to Citizens (that’s real safe)
3) Work with the carriers that are writing and make prudent choices as to who you represent.
4) Work with any carrier admitted by the state.
Personally I’ll work with the carriers that are writing and I’ll be proactive in watching their financial picture.
Companies went out of business because the reinsurance rates went up and the State didn’t allow companies to raise rates as needed. Add to that fraudulent claims, and you’ve got big problems. The State has caused these issues – at least many of them. Florida Peninsula has a large enough surplus and revenue that they can
stay for the long haul. True, smaller ones may not survive. But don’t lump them all together.
You’ve left out the Public Adjusters, sinkholes, and the Wind Mitigation credits which have no basis on reality – other than Christ’s and McCarty’s.
With regard to the wind mitt issue, read the FAIA White Paper on the subject. It’s dead on in describing the situation facing carriers. This is evident in the number of carriers, including Citizens, who are re-inspecting homes. Early indications are that 60 – 80 percent of the re-inspected homes had credits they were not eligible to receive.
Combine the significant (and unrealistic)discounts afforded by the wind mitt program with the fact that the re-insurers don’t take mitigation into account, add a heavy dose of regulation and rate suppression and what you get are failed companies.
Florida Peninsula has good numbers on paper. Let’s hope this works out for them.
Good Numbers?????? My policy went from $1247/ yr with Edison to $2776.96 with Fla Pinisula WHAT A RIP OFF!
The only way this will work is if they get a substantial rate increase. most of this book is new construction with hefty wind mit discounts and the premium does not cover the reinsurance costs due to the location of the risk. I hope they got a really good deal because much of this business is already being moved because of the uncertainty of Edison’s future. Fl. Peninsula’s way of doing business with agents is not that appealing and the compensation plan sucks. It is one of the lowest out there and that is why the bulk of business is take out policies. Hope the can make it work or it will be what kills them.
Florida Pen’s compensation plan isn’t the best out there. They compensate for it with an easy to use system, fair underwriting guidelines, and they accept credit cards.
As for Edison’s book, it is mainly newer homes. Whether the premium justifies reinsurance is another story. I’m certain it does but because you’re talking about a company that had only 25,000 policies, there was too much overhead to see a profit. We’ll see what happens.
FPI is one of the bigger state only carriers, and their reputation has always been pretty darn good. I also hope this works out well.
Too funny Solvent!
Two pieces of sh*t now become one pile!
All of these Florida start ups are a ponzi scheme, did your read about Magnolia last week. FL Peninsula will eventually be next!
Florida Peninsula has $70 million in surplus and premiums in the $191 million range. Big ponzi Bill.
FPI my not be a national carrier, but they seem to always be doing decent things for the industry and the State. There are many companies to complain about; I don’t think FPI is one of them.
Thats right it is a pretty big ponzi isnt it? The only reason there is 70 Million in surplus is the State says they must maintain it to write this amount of premium. The plan for all these carriers is to get the premiums high enough for the the big payday when they strip the company of all cash and turn it over to DOI or FIGA when the wind blows.
None of the start up carriers are looking for longevity in the financial aspect of runing the companies. Grab the money and run through your MGA or management company is the usual business plan. It Looks to be a very big payday for the stockholders of the MGA or management company.
Bill, you don’t have a clue about what you’re talking about. Magnolia is an example of a company that was allowed to write a similar amount of premium with only $20 million in surplus. Florida Peninsula adds to their surplus each and every year. What do you notice about those that go insolvent? Surplus decreases while premium increases. Get a grip man.
That comment was just irresponsible and ridiculous. We started as agents for Florida Peninsula. In 2007, and have never had any problems. They were started by big company guys and have always told us – and shown us – that they were here to stay. They have a great agency interface for quoting and endorsements, although the commission rate is just ok. Not every company is fly by night.
the only reason a carrier would add to its surplus is to allow for growth or pay claims for future growth. surplus to written premium is pretty important to a carrier who wants to write more premium. My only question is why would this carrier want to write more premium in florida. If it is to stay in business why isnt Nationwide expanding or State Farm, or Allstate writting more business at the same crazy rates as these fly by nights in Florida. The reason is to get as much money in the company to strip it later. That is the same business model of the 5 start ups to go insolvent last year in Florida.
Mr. Solvent, By the way I have a better grip on this situation than you do. The 20 Million was not surplus it was a loan to start up the company. Here is the pres release discussing the effects of these small start ups in Florida on the market by the association of insurance carriers
Consider Magnolia Insurance. It has been approved by state regulators to take up to 120,000 policies out of Citizens. If it does take the entire load, it will catapult itself from zero to among the 10 largest private insurers in the state. So far, it has taken out just over 45,000.
Magnolia is headed by H. James Irl, who used to run Florida Insurance Premium, whose license he surrendered when he began to work on forming the new firm. The $20 million start-up capital came from a $23.8 million LOAN from Allianz Risk Transfer, a New York subsidiary of Allianz AG, an international insurance, banking and asset management company based in Zurich.
I bet if you were able to see Mr. Irl’s bank account now, it would show the 20 million in surplus you said it had, plus and Allianz was paid back its 20.3 million LOAN to capitalize the ponzi scheme.
Why wouldn’t they want to grow in Florida Bill? There’s plenty of profitable business to be had for a reasonable company. Why would a company like Universal Insurance Company of North America with an AM Best rating grow? ASI? Florida Family?
Of the 23 million used to startup Magnolia, $20 was put into policyholder surplus.
Where is it now? No hurricane?….
If it is so profitable to write homeowners then why did all of these wonderful 5 start ups go bust last year without a catastrophic event?
If it is profitable why are there not more carriers running to Florida to write business. Why because they want to remain in business. GET A GRIP!
I am just glad I am not one of your insureds looking for sound financial advice on my homeonwers carrier.
You didn’t address any of my concerns Bill. You are a joke, not an insurance agent.
Coral- Showed declining surplus and increasing premium before failure.
American Keystone- Showed declining surplus and increasing premium before failure.
Magnolia- Showed declining surplus and increasing premium before failure.
You can’t just state an opinion and blanket it over all companies. There are plenty of Florida only companies who are in it for the long haul. Does Tower Hill ring a bell with you? How many years have they been here?
Universal Insurance Company of North America with an AM Best rating grow? ASI? Florida Family?
ALL MINOR LEAGE CARRIERS AT BEST. NO PUN INTENDED.
Where are the real carriers. All on the bench. Why because stupid agents dont demand more out of Crist and McCarty playing politics with our industry.
It is our job to properly advise our clients on the true threat to them by having there insurance written through a fly by night carrier and FIGA having a $300K cap on what it will pay in the event of a catastrophe and your clients will be at your door wanting an good explaination as to why you wrote their homeowners with Mutual of Oh My God.
Good luck with that scenario. I am wanting to fix this issue before it happens. Lets find a way to create an incentive for the good carriers to come back to Florida and by the way they pay 15% commissions. Sound good? it does to me.
Solvent, OK so not all florida based carriers are a ponzi. but 90% are!
You didnt answer my concern? If Florida such a profitable place to do business and reasonable carriers should do business here, then why isnt State Farm, Allstate, Nationwide, Auto Owners, Met Life Home and Auto, Atlantic Mutual Ins. Co. Hartford, Travelers, Safeco, Firemans Fund, Liberty Mutual, Cincinati, Harleysville Mutual,or any other A+X best rated carrier or better willing to write business here. Why have they all chosen to stay away from writing $300K homes for $900. a year in Florida and your wonderful carriers are falling all over themselves to do it? Huh….
I hear crickets… chirp…….chirp….
Bill what you’re proposing isn’t a bad idea. The issue is what we’re to do in the meantime. You can do any of the following as an agent:
1) Refuse to sell Homeowner’s policies.
2) Dump your homeowners to Citizens (that’s real safe)
3) Work with the carriers that are writing and make prudent choices as to who you represent.
4) Work with any carrier admitted by the state.
Personally I’ll work with the carriers that are writing and I’ll be proactive in watching their financial picture.
The big companies are out because of the regulatory environment. You know it and so do I. I gave the options in my last post.
Personally, I don’t represent any company that would write a $300K home for $900…at least not in this neck of the woods.
Edison would have written the 300K home for $800. JK
Peoples Trust would write it for $450
Bill “Edison would have written the 300K home for $800. JK”
Then why has my 250K home insured for a grand total, just got the bill, of $1,499.00?? Edison billing.
Companies went out of business because the reinsurance rates went up and the State didn’t allow companies to raise rates as needed. Add to that fraudulent claims, and you’ve got big problems. The State has caused these issues – at least many of them. Florida Peninsula has a large enough surplus and revenue that they can
stay for the long haul. True, smaller ones may not survive. But don’t lump them all together.
I think Edison had more of an overhead and small size problem. It probably wasn’t rates.
Agent,
You’ve left out the Public Adjusters, sinkholes, and the Wind Mitigation credits which have no basis on reality – other than Christ’s and McCarty’s.
With regard to the wind mitt issue, read the FAIA White Paper on the subject. It’s dead on in describing the situation facing carriers. This is evident in the number of carriers, including Citizens, who are re-inspecting homes. Early indications are that 60 – 80 percent of the re-inspected homes had credits they were not eligible to receive.
Combine the significant (and unrealistic)discounts afforded by the wind mitt program with the fact that the re-insurers don’t take mitigation into account, add a heavy dose of regulation and rate suppression and what you get are failed companies.