It seems like everything Citizens does is designed around keeping premiums low. Sinkhole rate increases? No problem, we’ll cut other coverage.
I don’t really have a problem with it since Citizens should offer the most basic of basic policies. But if the sinkhole rates weren’t increasing, they probably would not have taken this step.
I honestly believe that this move is to make the carrier less attractive. When you’ve got that screen enclosure and company XYZ quotes it $1,500 while Citizens is $1,450 you may be more likely to elect the private carrier. Unfortunately many agents twist the 15% rule or ignore it all together.
All this is smoke and mirrors, the State of Florida should not even be in the business, many are dropping policies altogether because of the high premiums and now they are going to cut coverage. Get rid of public adjusters, get rid of citizens, get rid of regulation that keeps AAA rated companies out of Florida and let the market place adjust, many are paying off mortgages just to avoid insurance, this is just another replay of the medical insurance debacle, my message to our Governemor, read this and act on it, otherwise I predict that when a disaster strikes there will not be enough in the fund to cover what we are all stuggling to pay for now……..government insurance, that spells an oximoron, I think I spelled that right? Check out what happedned in Illinois when a sunset law expired, rates plumeted and AAA companies where everywhere, learn from this Florida!!!!!!
I’m with you except getting rid of Citizens. Every state has a residual market. Most won’t give you an HO3 at a market competitive rate though. HO1 or HO8 at an insane price is what you get in most parts of the country. The thing is I have a market for all but the absolute least desirable risks when you throw in E&S lines. If you make Citizens even less attractive than the E&S companies my guess is we’d see policy count drop like a rock.
Why should Citizens have the most attractive policy? Maybe these coverage changes will take it back to what it was supposed to be…The insurance place of last resort. I’m surprised they haven’t been offering an HO-5 with the ability to schedule personal property.
Call me crazy, but how many screen enclosures do you think are claimed after the wind blows? How much premium was collected for said enclosures?
This is an easy target for reducing claims cost. Aside from looking at overall reduction of claim expenses, I highly doubt that this is connected to sinkhole.
Sadly, there isn’t a solution for Florida other than removing expensive development from the coasts. Unlike most states with coastal hurricane exposures, the entire state of Florida is at risk so the coastal risks can’t be subsidized by the insureds in other parts of the state.
If insurers were allowed to charge adequate rates on the coasts for the exposure, Buffett and Gates would be nearly the only ones who could afford it. At the end of the day, the Federal government will ride in on their white horse and allow Florida residents to steal the money from taxpayers in other states.
I have to disagree with you. There is a rate for every risk and with proper competition in the marketplace it could be affordable to live in coastal counties. For those that build on barrier islands, they already can afford the high premiums that are necessary.
to say that everyone who owns a home on a barrier island can afford high premiums is ridiculous. not everyone lives in a mansion or owns a place as a second or third home. many homes are smaller and have been in the family for decades.
Instead of not covering these exposures, why not add them for a certain prem and cap the coverage. Screen enclosure caped at $10,000.00 and so on. If this property was purchased with a bank loan, how will it be covered as it was part of the property appraisal. A bunch of asses running an Insurance Company. Their problem lies with South Florida where all the corruption is going on with the Public Adjusters and Attys. This goes for Sinkholes as well. The big shots in Ctiizens have no balls, all politicly tied together at the tax payer cost
Bob, your frustration is duly noted. My initial reaction was to charge an additional premium for the enclosures as well instead of eliminating the coverage. But this direction is probably the best. It seems like Citizens can’t seem to price correctly/appropriately so the best way to make Citizens unattractive is to begin stripping away coverage.
i agree about screens and carports needing coverage, and the way many companies do it is by having it be an endorsement with an additional premium charge. citizens could do that too.
as to the supply of coverage throughout the state, how about citizens taking over JUST hurricane coverage and outlawing other companies from writing it. also, eliminate cherry picking of which areas a company will write – every company has to offer coverage in every county. then other companies could come into the state as they will be writing just the coverage they write elsewhere, and competition will see who writes where. in the meantime, citizens hurricane exposure could be paid for by the premiums the other companies are currently sending to offshore unregulated reinsurance companies, bringing that money back home and having it regulated. with improvements such as giving better (larger) credits for higher deductibles, mayber consumers will be able to afford insurance again.
I lean towards just deleting the coverage as Citizens plans on doing. If the insured wants the coverage for their pool cage they can buy from the private market. Citizens shouldn’t compete or compare to the private market. On another note I am betting Citizens keeps the pool cage question on their replacement cost estimate even though they no longer cover them they will make you rate for them. Collect premium for what they don’t cover.
part of Florida’s problem is that sometimes Citizens is the only company writing coverage for that particular home – zip, age, condition issues etc. if other companies can actuarily rate for a cage, Citizens can too. these market shifts from company to company for coverage and price do not do the insurance industry, consumers, or agents any worthwhile gain. need to focus on creating a working system, otherwise we will only see more availability problems, price increases, and when the big one hits, more insolvencies.
I would like to know what a screened enclosure has to do with the peril of fire and why these should be excluded from anything but wind. Also, think of all the people with mobile homes who can’t get coverage any where but Citizens, think of all the carports and
added on alum lani’s that will have no coverage. The private carriers pick and choose what they will take. If Citizens is going to bother to provide coverage for those that can’t get it elsewhere it should provide comparable coverage. They should have charged for the screen enclosure risk.
good point on separation of coverages. on the mobile homes, they are made of aluminum or steel, so an attachment made of aluminum or steel would probably be covered as it is of the same material. but i suspect citizens will figure how to zap that issue.
Mortagees may have something to say about that.
I don’t think so Bob. They don’t when private carriers exclude the same types of coverage.
It seems like everything Citizens does is designed around keeping premiums low. Sinkhole rate increases? No problem, we’ll cut other coverage.
I don’t really have a problem with it since Citizens should offer the most basic of basic policies. But if the sinkhole rates weren’t increasing, they probably would not have taken this step.
I honestly believe that this move is to make the carrier less attractive. When you’ve got that screen enclosure and company XYZ quotes it $1,500 while Citizens is $1,450 you may be more likely to elect the private carrier. Unfortunately many agents twist the 15% rule or ignore it all together.
All this is smoke and mirrors, the State of Florida should not even be in the business, many are dropping policies altogether because of the high premiums and now they are going to cut coverage. Get rid of public adjusters, get rid of citizens, get rid of regulation that keeps AAA rated companies out of Florida and let the market place adjust, many are paying off mortgages just to avoid insurance, this is just another replay of the medical insurance debacle, my message to our Governemor, read this and act on it, otherwise I predict that when a disaster strikes there will not be enough in the fund to cover what we are all stuggling to pay for now……..government insurance, that spells an oximoron, I think I spelled that right? Check out what happedned in Illinois when a sunset law expired, rates plumeted and AAA companies where everywhere, learn from this Florida!!!!!!
I’m with you except getting rid of Citizens. Every state has a residual market. Most won’t give you an HO3 at a market competitive rate though. HO1 or HO8 at an insane price is what you get in most parts of the country. The thing is I have a market for all but the absolute least desirable risks when you throw in E&S lines. If you make Citizens even less attractive than the E&S companies my guess is we’d see policy count drop like a rock.
I am a little stumped as I did not see anything about the $10,000 cap on cosmetic damage to floors???
Why should Citizens have the most attractive policy? Maybe these coverage changes will take it back to what it was supposed to be…The insurance place of last resort. I’m surprised they haven’t been offering an HO-5 with the ability to schedule personal property.
Call me crazy, but how many screen enclosures do you think are claimed after the wind blows? How much premium was collected for said enclosures?
This is an easy target for reducing claims cost. Aside from looking at overall reduction of claim expenses, I highly doubt that this is connected to sinkhole.
Ban the State Farm multiline discount.
Ban State Farm and Allstate agents from writing in Citizens until they become completely independent on the fire product line.
Sadly, there isn’t a solution for Florida other than removing expensive development from the coasts. Unlike most states with coastal hurricane exposures, the entire state of Florida is at risk so the coastal risks can’t be subsidized by the insureds in other parts of the state.
If insurers were allowed to charge adequate rates on the coasts for the exposure, Buffett and Gates would be nearly the only ones who could afford it. At the end of the day, the Federal government will ride in on their white horse and allow Florida residents to steal the money from taxpayers in other states.
I have to disagree with you. There is a rate for every risk and with proper competition in the marketplace it could be affordable to live in coastal counties. For those that build on barrier islands, they already can afford the high premiums that are necessary.
to say that everyone who owns a home on a barrier island can afford high premiums is ridiculous. not everyone lives in a mansion or owns a place as a second or third home. many homes are smaller and have been in the family for decades.
Instead of not covering these exposures, why not add them for a certain prem and cap the coverage. Screen enclosure caped at $10,000.00 and so on. If this property was purchased with a bank loan, how will it be covered as it was part of the property appraisal. A bunch of asses running an Insurance Company. Their problem lies with South Florida where all the corruption is going on with the Public Adjusters and Attys. This goes for Sinkholes as well. The big shots in Ctiizens have no balls, all politicly tied together at the tax payer cost
South Florida doesn’t have a sinkhole problem Bob. Public parasites have gone into West and Central Florida since we haven’t had a storm in 6 years.
Bob, your frustration is duly noted. My initial reaction was to charge an additional premium for the enclosures as well instead of eliminating the coverage. But this direction is probably the best. It seems like Citizens can’t seem to price correctly/appropriately so the best way to make Citizens unattractive is to begin stripping away coverage.
i agree about screens and carports needing coverage, and the way many companies do it is by having it be an endorsement with an additional premium charge. citizens could do that too.
as to the supply of coverage throughout the state, how about citizens taking over JUST hurricane coverage and outlawing other companies from writing it. also, eliminate cherry picking of which areas a company will write – every company has to offer coverage in every county. then other companies could come into the state as they will be writing just the coverage they write elsewhere, and competition will see who writes where. in the meantime, citizens hurricane exposure could be paid for by the premiums the other companies are currently sending to offshore unregulated reinsurance companies, bringing that money back home and having it regulated. with improvements such as giving better (larger) credits for higher deductibles, mayber consumers will be able to afford insurance again.
I lean towards just deleting the coverage as Citizens plans on doing. If the insured wants the coverage for their pool cage they can buy from the private market. Citizens shouldn’t compete or compare to the private market. On another note I am betting Citizens keeps the pool cage question on their replacement cost estimate even though they no longer cover them they will make you rate for them. Collect premium for what they don’t cover.
part of Florida’s problem is that sometimes Citizens is the only company writing coverage for that particular home – zip, age, condition issues etc. if other companies can actuarily rate for a cage, Citizens can too. these market shifts from company to company for coverage and price do not do the insurance industry, consumers, or agents any worthwhile gain. need to focus on creating a working system, otherwise we will only see more availability problems, price increases, and when the big one hits, more insolvencies.
I would like to know what a screened enclosure has to do with the peril of fire and why these should be excluded from anything but wind. Also, think of all the people with mobile homes who can’t get coverage any where but Citizens, think of all the carports and
added on alum lani’s that will have no coverage. The private carriers pick and choose what they will take. If Citizens is going to bother to provide coverage for those that can’t get it elsewhere it should provide comparable coverage. They should have charged for the screen enclosure risk.
good point on separation of coverages. on the mobile homes, they are made of aluminum or steel, so an attachment made of aluminum or steel would probably be covered as it is of the same material. but i suspect citizens will figure how to zap that issue.