Florida Agents Will Soon Need Three Appointments Before Selling Citizens

Starting July 1, Florida insurance agents must have at least three appointments with authorized carriers before they can sell policies for the state-created Citizens Property Insurance Corp.

That’s the mandate laid down by Florida House Bill 1503, signed into law this month by Gov. Ron DeSantis.

“Upon the law becoming effective, Citizens will require each agent writing business with Citizens to hold at least three appointments with authorized insurers for each line of business,” including personal residential, commercial residential and other commercial properties, reads a bulletin posted last week by Citizens.

Previous law required only one appointment for agents.

“Agents who are unable to, or choose not to obtain the required appointments will lose the ability to write, service, or renew business in that line of authority,” the bulletin notes.

Citizens will notify agents if they are in violation. At that point, agents will have to obtain appointments with other carriers or transfer their book of business to an eligible agent, Citizens said. A list of approved property insurance carriers can be seen here.

The law, which also allows surplus lines insurers to take out Citizens policies on secondary homes, is part of a continuing effort by lawmakers and regulators to trim the girth of Citizens and steer more business back to the private market — without actually removing the glidepath or statutory cap on Citizens’ rate increases. Citizens, by far the largest property insurer in Florida, reported 1.18 million policies in force at the end of April, a slight increase from March but down from the peak of 1.4 million policies in September 2023.

Citizens officials could not provide an estimate on the number of Florida agents who may be affected by the new rule, but some agents have estimated it could be more than 1,400.

The new requirement could be painful for some agents who have relied on Citizens and its often-lower premiums to cover properties in the stressed Florida market.

“I would think it would be new agents that would be most affected – those that are trying to start their business and don’t have many appointments,” said Clayton Fischer, an agent with Blue Marlin Insurance, an agency in Miami that holds appointments with more than 15 carriers.

The logic behind the law is not disputed: More appointments give agents and insureds more choices when seeking or renewing coverage, agents have pointed out.

“It’s not a bad thing for consumers,” said Karen Roeling, a commercial lines producer with Seibert Insurance Agency in Tampa. “It gives more options.”

If an agent is appointed only with one or two carriers, and one of those is Citizens, it’s more likely that the policyholder will end up with the corporation that was created to be something of an insurer of last resort for the state, she noted.

“The whole deal is to keep policies out of Citizens,” said David Thompson, an all-lines agent in Vero Beach.

The Florida Association of Insurance Agents’ B.G. Murphy said in a blog last week that the association had received many inquiries from agents about the new law. FAIA is communicating with Citizens’ leadership and will provide additional information as it becomes available, he noted.

Agents may have more options for appointments this year. Although more than a dozen carriers have gone insolvent or have pulled out of the Florida market in the last three years, the Florida Office of Insurance Regulation has approved at least eight new insurers so far this year, and more are expected.

Most of those are reciprocal exchange-type insurers, a business model that is still a new concept for some agents, Fischer said.

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