Gotta ask you FL agents, from where I am sitting I cannot imagine the workload, staffing, and in general the ops required to keep my agency afloat if I operated in FL. What is it like? Are books closing? What is happening?
The work load is beyond belief. We are telling many customers that we cannot do anything about their HO or other property premiums. In some cases (I’m in the worst place for residential property insurance, South Florida), we are unable to place their non-renewed or cancelled policy anywhere, even in the residual government run market. The property just doesn’t qualify because of the age, condition, claims or the location. The FL hard market of 2004-2008 was the worst ever but it will pale in comparison to this situation. If 17 FL HO carriers are being downgraded (and basically disqualified) by Demotech and a total of 27 companies are going to be on a “watch” list, then it is essentially armageddon for the property insurance biz in our state.
Citizens doesn’t work like a typical residual market. They’re not compelled to take everyone. This is probably the hardest thing to explain to people from out of state.
27?? That’s a huge chunk of the market. Holy moly.
There’s ~160 carriers licensed to write HO in FL. 70 carriers with active PIF. If 50 of these are actively writing, that’s over half of the HO carriers actively writing in the FL HO market under enhanced monitoring… What a market.. (if that’s what you can even call this monstrosity).
As a FL agent, it is important to write coverage with the strongest companies. If you write a policy with Citizens it eventually gets “taken out” by a small company and these companies might have generated the revenue to start the company through the “take out” revenue. We would like to see them all have success but playing the the FL market, they get eaten alive by the attorneys and fraudulent contractors. If they attorney fees and contractors fraud is not stopped it is a never ending cycle and our insureds cant afford to pay premiums to make these industries rich.
10% would be nice! Try the recently released Citizens statewide average (released 07/2022) HO3: 7.4%, HO4 :8.2%, HO6: 7.6%, MHO3: 6.8%, MHO4: 8.1%, DP1: 7.1%, DP3: 7.2%, MDP1: 7.3%. We won’t even mention the increased time it takes to quote and write ONE policy with Citizens (often hours).
you see the legislator and the press ask the wrong questions. Ask of all the law suits filed how many are lost by insurance company’s. Try like 90% losers. Now do not say that the PA’ and attorney’s Are the problem. I must be Florida civil system. Oh the judges and jury’s are wrong. Our civil system is full of fraud. I told several State Senators years ago..I as a PA would not have a profession if the carrier paid claim correctly. Stop looking for ways not to pay and start looking at the correct way to pay a claim. Now back to the $3B dollars spent on legal fees. If all those claims were paid correctly how much of the $3 billion would be left over.. Of even how much short would you be. Do the math.
Mark, you hit the nail right on the head. After years of the same old tricks, these Insurance companies, has not yet learn how to stop these third parties get-away trains that have been milking the insurance industry, for years.
“Stop looking for ways not to pay and start looking at the correct way to pay a claim.” If companies went in this direction there would be $2B less in legal fees and $5B more in indemnity payments.
So how do you propose the insurance pay the claim the “right way” in this scenario – a scenario that plays out every single day in FL. Joe buys home 2021, his 16yr old shingle roof is showing its age and needs to be replaced. Just FYI, a 30-year rated shingle does not actually last 30 years in the baking hot FL sun. He gets estimates for re-roof but decided not to move forward with replacing his roof. Known Shady Roof Contractor knocks on his door one day, just like they canvas and knock on the doors in entire communities every single day, tells him they see hail damage from a nonexistent hailstorm we supposedly suffered on 3/11. There were no reports of hail in the area. They tell him they can replace his roof for free (um, what about his deductible?), just sign this AOB. Joe thinks great! and signs the AOB and Shady Roof Contractor files a claim on his behalf. Insurer denies the claim because the roof photos look exactly the same as they did when they inspected the home slightly more than a year ago, weather history shows no hail at anytime recently, and, wait for it…There is NO hail damage to his pool screen cage that is attached to same roof. How does roof have hail damage all over but the attached pool cage does not? Well, because there was no hail. Shady Roof Contractor files a lawsuit. Joe admits to me that he knows there was no hail, he knows that the roof is just old, but he’s still pissed off that Insurer denied the claim so he is happy Shady Roof Contractor is proceeding with lawsuit. Every. Single. Day. this and similar scenarios plays out in FL. We average nearly 400 lawsuits a day for this type of thing. Other states average 2. And too many homeowners flat out refuse to replace their olds roofs, even when they are leaking, until they have a bad enough storm come through that they can blame it on. Too many do not take personal responsibility and do not maintain their homes. If it’s expensive someone else must pay for it, right? Being expensive is not a covered peril. How does anyone think this is okay?
Agree Carla! We just had a claim come through our agency for ‘storm damaged roof’. $25,000 for the roofer/roof replacement and $64,000 for legal fees for a total of $84,000. There is not a “right way” of handling that. The company, of course, disputed the claim because it was fraud. The roof was 18 years old and in poor condition. it was clearly wear and tear and nothing else. The unholy alliance of lawyers, PA’s and contractors have essentially destroyed the FL HO biz. They did water damage, mold and roof replacements. They are throwing in cast iron pipes so that is also going to cost massive amounts of $ Unless and until the alliance is cut off and shut down, the FL HO biz is absolutely doomed.
15 years ago, we needed a book with a 65% loss ratio to be profitable. Now companies want a 35% loss ratio. If expenses have essentially doubled in the last 15 years, we’re doing something drastically wrong. The CEO of FedNat made 285,000 in 2010, but made $1.915 million in 2022. In the words of C+C Music Factory: Things that make you go “Hmmmmm”
he’s been making over a million every year that the insurance market has been taking big losses, it would be interesting to see how much the CEO’s were making for the insolvent carriers too.
a 65% loss ratio has NEVER been acceptable for property in a highly reinsured market like Florida. Carriers cede as much as 50% of their premium to reinsurers.
For the first time in over 35 years in this business, many of us no longer enjoy being an insurance agent. It’s hard to tell a client on a fixed income that their policy had a rate increase of over $1500 (or more) and we have no other carriers to offer because their roof is more than 10 years young or has stains possibly from granular loss. Or someone who is being nonrenewed then file a new roof claim thanks to a public adjuster knocking on their door, and now we have to send them a “no market” letter because they have an open claim or existing damage. It’s very frustrating!
I listened to a long form interview with Barry, CEO of citizens recently. He implied that there was a moral or ethical change in the population of Florida. Essentially, less aversion to filing claims or perhaps a propensity to file bogus claims. I presume that the law prohibits this, but maybe we need to strengthen these rules and enforcement. Maybe we (SoF) need to start prosecuting claimants and attorneys when cases are fraudulent.
The homeowners that have legal claims have to fight (LAWYER UP) for payments on their damage claims and the betraying liars get payments for claims right away. There needs to be inspection reports by roofing contractor and insurance adjuster detailing all the damages as well as weather reports to support, pictures and video submitted on every claim with insurance declaration page. Roof Inspections should be required as a term for coverage 3 times a year by a roofing contactor. Insurance carriers need to add in policy’s fraud claims and consequences with prosecution statements. And follow through with customers who file fraudulent claims. If there continues to be no impact for filing wrongful fraudulent claims, there is no reason for anyone not to file them and hope for payment. We must all work together to get this problem in control STARTING WITH ROOFING CONTRACTORS there are a few of us who only want to service the real legit customers who have occurred damages and file the claims correctly having only the materials and labor costs for the roof replacement to code standards. Prosecute all the party’s homeowners, & contractors for filing wrongful damage claims if the homeowner knows it a fraudulent claim turn in the contractor to be relieved of prosecution otherwise GUILTY as contractor who filed claim. THE ONLY WAY TO STOP PEOPLE FROM ABUSING THE SYSTEM IS PROSECUTION FOR DOING SO. Contractors should loose their license or pay a hefty fine to get back their ethics they have lost. Homeowners should be charged with fraud and based on the amount of claim justice be served. When homes are bought and sold home inspections must be enforced and if roof is 10 years or older it needs replaced for insurance carrier to be able to provide coverages it sells. We have to have in place guidelines to be followed for homes to stop the areas for fraudulent claims proactive reactive and correctively put in place.
I read the report and all I could think about is that it is the sheet music that the quartet is playing as the Titanic sinks.
Gotta ask you FL agents, from where I am sitting I cannot imagine the workload, staffing, and in general the ops required to keep my agency afloat if I operated in FL. What is it like? Are books closing? What is happening?
The work load is beyond belief. We are telling many customers that we cannot do anything about their HO or other property premiums. In some cases (I’m in the worst place for residential property insurance, South Florida), we are unable to place their non-renewed or cancelled policy anywhere, even in the residual government run market. The property just doesn’t qualify because of the age, condition, claims or the location. The FL hard market of 2004-2008 was the worst ever but it will pale in comparison to this situation. If 17 FL HO carriers are being downgraded (and basically disqualified) by Demotech and a total of 27 companies are going to be on a “watch” list, then it is essentially armageddon for the property insurance biz in our state.
Citizens doesn’t work like a typical residual market. They’re not compelled to take everyone. This is probably the hardest thing to explain to people from out of state.
27?? That’s a huge chunk of the market. Holy moly.
There’s ~160 carriers licensed to write HO in FL. 70 carriers with active PIF. If 50 of these are actively writing, that’s over half of the HO carriers actively writing in the FL HO market under enhanced monitoring… What a market.. (if that’s what you can even call this monstrosity).
As a FL agent, it is important to write coverage with the strongest companies. If you write a policy with Citizens it eventually gets “taken out” by a small company and these companies might have generated the revenue to start the company through the “take out” revenue. We would like to see them all have success but playing the the FL market, they get eaten alive by the attorneys and fraudulent contractors. If they attorney fees and contractors fraud is not stopped it is a never ending cycle and our insureds cant afford to pay premiums to make these industries rich.
This is so sad!
Hello,
As an agency that writes with Citizen they must increase the commission base to 15%.
We can not process a Citizen policy at 10% commission. We loose money based on the amount of work needed to write a policy.
10% would be nice! Try the recently released Citizens statewide average (released 07/2022) HO3: 7.4%, HO4 :8.2%, HO6: 7.6%, MHO3: 6.8%, MHO4: 8.1%, DP1: 7.1%, DP3: 7.2%, MDP1: 7.3%. We won’t even mention the increased time it takes to quote and write ONE policy with Citizens (often hours).
In Broward and Dade it works out to around 5.5%.
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Mark, you hit the nail right on the head. After years of the same old tricks, these Insurance companies, has not yet learn how to stop these third parties get-away trains that have been milking the insurance industry, for years.
“Stop looking for ways not to pay and start looking at the correct way to pay a claim.” If companies went in this direction there would be $2B less in legal fees and $5B more in indemnity payments.
So how do you propose the insurance pay the claim the “right way” in this scenario – a scenario that plays out every single day in FL. Joe buys home 2021, his 16yr old shingle roof is showing its age and needs to be replaced. Just FYI, a 30-year rated shingle does not actually last 30 years in the baking hot FL sun. He gets estimates for re-roof but decided not to move forward with replacing his roof. Known Shady Roof Contractor knocks on his door one day, just like they canvas and knock on the doors in entire communities every single day, tells him they see hail damage from a nonexistent hailstorm we supposedly suffered on 3/11. There were no reports of hail in the area. They tell him they can replace his roof for free (um, what about his deductible?), just sign this AOB. Joe thinks great! and signs the AOB and Shady Roof Contractor files a claim on his behalf. Insurer denies the claim because the roof photos look exactly the same as they did when they inspected the home slightly more than a year ago, weather history shows no hail at anytime recently, and, wait for it…There is NO hail damage to his pool screen cage that is attached to same roof. How does roof have hail damage all over but the attached pool cage does not? Well, because there was no hail. Shady Roof Contractor files a lawsuit. Joe admits to me that he knows there was no hail, he knows that the roof is just old, but he’s still pissed off that Insurer denied the claim so he is happy Shady Roof Contractor is proceeding with lawsuit. Every. Single. Day. this and similar scenarios plays out in FL. We average nearly 400 lawsuits a day for this type of thing. Other states average 2. And too many homeowners flat out refuse to replace their olds roofs, even when they are leaking, until they have a bad enough storm come through that they can blame it on. Too many do not take personal responsibility and do not maintain their homes. If it’s expensive someone else must pay for it, right? Being expensive is not a covered peril. How does anyone think this is okay?
Agree Carla! We just had a claim come through our agency for ‘storm damaged roof’. $25,000 for the roofer/roof replacement and $64,000 for legal fees for a total of $84,000. There is not a “right way” of handling that. The company, of course, disputed the claim because it was fraud. The roof was 18 years old and in poor condition. it was clearly wear and tear and nothing else. The unholy alliance of lawyers, PA’s and contractors have essentially destroyed the FL HO biz. They did water damage, mold and roof replacements. They are throwing in cast iron pipes so that is also going to cost massive amounts of $ Unless and until the alliance is cut off and shut down, the FL HO biz is absolutely doomed.
15 years ago, we needed a book with a 65% loss ratio to be profitable. Now companies want a 35% loss ratio. If expenses have essentially doubled in the last 15 years, we’re doing something drastically wrong. The CEO of FedNat made 285,000 in 2010, but made $1.915 million in 2022. In the words of C+C Music Factory: Things that make you go “Hmmmmm”
he’s been making over a million every year that the insurance market has been taking big losses, it would be interesting to see how much the CEO’s were making for the insolvent carriers too.
a 65% loss ratio has NEVER been acceptable for property in a highly reinsured market like Florida. Carriers cede as much as 50% of their premium to reinsurers.
For the first time in over 35 years in this business, many of us no longer enjoy being an insurance agent. It’s hard to tell a client on a fixed income that their policy had a rate increase of over $1500 (or more) and we have no other carriers to offer because their roof is more than 10 years young or has stains possibly from granular loss. Or someone who is being nonrenewed then file a new roof claim thanks to a public adjuster knocking on their door, and now we have to send them a “no market” letter because they have an open claim or existing damage. It’s very frustrating!
I listened to a long form interview with Barry, CEO of citizens recently. He implied that there was a moral or ethical change in the population of Florida. Essentially, less aversion to filing claims or perhaps a propensity to file bogus claims. I presume that the law prohibits this, but maybe we need to strengthen these rules and enforcement. Maybe we (SoF) need to start prosecuting claimants and attorneys when cases are fraudulent.
The homeowners that have legal claims have to fight (LAWYER UP) for payments on their damage claims and the betraying liars get payments for claims right away. There needs to be inspection reports by roofing contractor and insurance adjuster detailing all the damages as well as weather reports to support, pictures and video submitted on every claim with insurance declaration page. Roof Inspections should be required as a term for coverage 3 times a year by a roofing contactor. Insurance carriers need to add in policy’s fraud claims and consequences with prosecution statements. And follow through with customers who file fraudulent claims. If there continues to be no impact for filing wrongful fraudulent claims, there is no reason for anyone not to file them and hope for payment. We must all work together to get this problem in control STARTING WITH ROOFING CONTRACTORS there are a few of us who only want to service the real legit customers who have occurred damages and file the claims correctly having only the materials and labor costs for the roof replacement to code standards. Prosecute all the party’s homeowners, & contractors for filing wrongful damage claims if the homeowner knows it a fraudulent claim turn in the contractor to be relieved of prosecution otherwise GUILTY as contractor who filed claim. THE ONLY WAY TO STOP PEOPLE FROM ABUSING THE SYSTEM IS PROSECUTION FOR DOING SO. Contractors should loose their license or pay a hefty fine to get back their ethics they have lost. Homeowners should be charged with fraud and based on the amount of claim justice be served. When homes are bought and sold home inspections must be enforced and if roof is 10 years or older it needs replaced for insurance carrier to be able to provide coverages it sells. We have to have in place guidelines to be followed for homes to stop the areas for fraudulent claims proactive reactive and correctively put in place.