Florida’s property insurance market is showing more signs of life, with another company requesting a large takeout order from Citizens Property Insurance and two new companies entering the arena.
Tampa-based HCI Group’s CEO Paresh Patel said in an earnings call last week that the company had applied for up to 75,000 policies from Citizens, after posting a profit of $33 million for the first half of 2023 – a sharp improvement over the first half of last year.
“In previous earnings calls, we said we expected a material, beneficial impact from the new legislation in Florida, and that impact is starting to show up in our results,” HCI’s chief financial officer, Mark Harmsworth, said in the call. HCI’s Florida subsidiaries include Homeowners’ Choice Property & Casualty Insurance, with about 88,300 policies in force, and TypTap Insurance, with some 56,000 policies. It was not clear which insurer would assume the Citizens policies.
The takeouts, if approved by Florida regulators, could bring the number of Citizens takeout policies approved this year to more than 350,000. That’s seen as good news for the market, where Citizens, the state-created residual insurer, has grown to be the largest property carrier in the state, with more than 1.3 million policies.
And Florida Insurance Commissioner Michael Yaworsky announced Monday that his Office of Insurance Regulation has approved a Texas-based carrier, Mainsail Insurance Co., to do business in Florida. The news follows the approval of Tailrow Insurance, part of HCI Group, which was approved by the OIR in April.
Also, a week ago, Recoop Disaster Insurance, underwritten by Professional Solutions Insurance Co., said it plans to offer a type of parametric property coverage in Florida that pays a set amount, up to $25,000, after a storm.
Recoop executives could not be reached for comment, but the Florida OIR site shows that Professional Solutions, based in Iowa, has been in business in Florida since 2019. It is a part of NCMIC Insurance Co., which began as a malpractice insurer for chiropractors but now offers personal lines and business coverage.
It’s all pointing to a stabilizing market in the Sunshine State, which has seen four years of spiking premiums, carrier pull-backs, and a dozen insurer insolvencies. Yaworsky called the changes “positive signs” and he credited the 2022 and 2023 legislative changes, which ended one-way attorney fees and assignments of benefits in claims litigation.
“The addition of Mainsail Insurance Co. to the Florida market is evidence that recent legislative reforms are having a positive impact for consumers,” he said in a bulletin.
Mainsail is part of Hippo Holdings Inc., which manages Hippo Insurance and Spinnaker Insurance Co. Hippo Holdings is a publicly traded company headquartered in California. Co-founder Assaf Wand was replaced at the CEO spot last year by Richard McCathron, news outlets have reported.
Hippo Insurance is not active in Florida, but has expanded its presence into at least 15 states in recent years, the company has said. Spinnaker had about 57,000 policies in force in Florida at end of March, according to the latest quarterly report from the Florida OIR.
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