More Than a Dozen Florida Insurers Facing Ratings Downgrades

By | January 9, 2020

  • January 10, 2020 at 1:24 pm
    Ray Blacklidge says:
    Like or Dislike:
    Thumb up 11
    Thumb down 4

    Why would Demotec release this information without releasing the names of the companies? Now all Florida Domestics will be suspect of being in dire straights when in reality there are probably only a small handful that will be downgraded.

    • January 10, 2020 at 3:09 pm
      kevin May says:
      Well-loved. Like or Dislike:
      Thumb up 13
      Thumb down 0

      Ray

      They can’t name them as they may find a way out prior to the downgrade. Sending a note to Gilway at Citizens was not making it public….thats on Gilway for talking about stuff, before it gets released.

      A word from the wise….for most people your home is your single largest asset. check very thoroughly the financials of the company you entrust that asset with especially when living in a catastrophe prone state. I live in Florida and work in reinsurance so understand the risk and choose wisely. The less information on the website about assets and reinsurance and the people running the company is sometimes a good indicator. Check the policy holders surplus and how much premium they write…any more than 4X surplus in premium screams leverage in a market that is tough to make money in right now

  • January 12, 2020 at 3:04 pm
    Tiger88 says:
    Like or Dislike:
    Thumb up 11
    Thumb down 2

    As a Florida agent, I take this with a “I’ll believe it when I see it” attitude. This is at least the 3rd time that Demotech has threatened the Florida carriers with “downgrades”. The last time was big nothing burger that unnecessarily upset our customers. And Kevin May the reinsurance broker is correct about the financial condition. The Florida Insurance Guarantee Association has a cap of $300,000 for homeowners in the event of an insolvency. If you house is valued (replacement cost) for more than that you could have a great deal of trouble post-hurricane in the event of a carrier liquidation. However, anytime we speak to customers about such things, they look at our A+ rated offer of $9,000 in premium and say “nah…it will be OK” and take some no-name Demotech rated company because they are only charging $3,000,

    • January 13, 2020 at 10:44 am
      Mr. Solvent says:
      Like or Dislike:
      Thumb up 3
      Thumb down 3

      The last time it was threatened several carriers put more money into surplus to maintain their rating. Perhaps you haven’t been in the business long but Demotech has often caught onto a carrier’s issues long before any of the bigger agencies. Maybe Poe Financial rings a bell, or maybe you’re not in the business long enough to remember it.

      • January 13, 2020 at 11:20 am
        Jack says:
        Like or Dislike:
        Thumb up 3
        Thumb down 0

        Mr. Solvent I’ve also seen them miss it the other way as well. A carrier goes from A to crap. Keep in mind a bank will not accept homeowners insurance from a carrier rated less than an A from Demotech and unfortunately Demotech does not have a B like AM Best.

        • January 13, 2020 at 1:16 pm
          Mr. Solvent says:
          Like or Dislike:
          Thumb up 4
          Thumb down 0

          I have no skin in the game whatsoever except that I’m a long time agent. They caught Coral, Magnolia, Northern Capital, American Keystone, Florida Specialty, Poe, and Sawgrass Mutual. Nobody can catch everyone, but Demotech has a good track record.

          If I have 1 complaint it’s that they don’t have any ratings that give less than a 90% chance of survival.

          • January 13, 2020 at 3:17 pm
            Tiger88 says:
            Like or Dislike:
            Thumb up 5
            Thumb down 0

            Been in the business since 1985 and I worked on replacing about 3,000 Poe Financial policies so been there and done that. My point is not that Demotech does get it in gear but rather the way it was handled was objectionable. I would much prefer that Mr. Petrelli (who has commented on this article) not release this general and cryptic information until all responsible parties are notified, have decided on their course action and they just tell the public what is going including the company names and their financial impairments. This article is already all over the place in Florida and customers are calling on it asking if their company is on “the list.”

          • January 14, 2020 at 10:23 am
            Mr. Domestic says:
            Like or Dislike:
            Thumb up 2
            Thumb down 1

            “Before any of the bigger agencies”? Nearly all the Florida domestics have no other ratings besides Demotech. I can’t think of anyone that didn’t have an A rating 120 days before they went bust or were sold.

          • January 16, 2020 at 10:08 am
            Mr. Solvent says:
            Like or Dislike:
            Thumb up 4
            Thumb down 0

            Mr. Domestic, Poe was about 4 months before failure, Florida Specialty was downgraded twice in the final 3 months of their lives, and American Keystone had about a 6 month heads up with downgrades. That’s just off the top of my head.

            Poe companies were AM Best rated…FACT…

  • January 13, 2020 at 10:34 am
    Joe Petrelli says:
    Like or Dislike:
    Thumb up 9
    Thumb down 0

    We did not release the information or the letter. Evidently, in the normal course of their duties, at least one of the recipients released my letter.

    Joe

  • January 13, 2020 at 1:03 pm
    Exadjuster says:
    Like or Dislike:
    Thumb up 2
    Thumb down 0

    What have hurricanes and sinkholes wrought?



Add a Comment

Your email address will not be published. Required fields are marked *

*