Florida’s Property Insurance Landscape: Adapting Amid Growing Risks and Market Shifts

As we navigate through the hurricane season, Florida’s property insurance market is experiencing a dynamic shift. While some companies, like The Farmers Group and AIG, are scaling back policy coverage due to vulnerability to natural disasters, others are capitalizing on new opportunities presented by the Citizens Property Insurance Corporation’s depopulation program.

Understanding the Citizens Depopulation Program

Florida’s Citizens Property Insurance Corporation has expanded its policy count and exposure significantly, driven by challenges faced by carriers in the state’s property insurance market. Understanding this, the Citizens Depopulation Program was launched to enable the residual market insurer to offload policies to private market entities willing to assume them. This move can help Citizens downsize its risk portfolio while providing new businesses with a source of pre-established and vetted business opportunities, which can be considered “semi-seasoned” due to their prior oversight by Citizens. The concept is not new; takeouts from Citizens were notably popular between 2013 and 2017, helping the insurer shrink its portfolio dramatically. However, the effectiveness of this approach comes with caveats. Timing is critical with takeouts, and beneficiaries were often hard hit by the 2017 hurricane season impacts in Florida. Yet, some carriers, such as Slide and Loggerhead Insurance, find the risk from the Florida Citizens portfolio attractive and are set to assume thousands of policies right in the middle of the Atlantic hurricane season. This move underscores the allure that Citizens’ businesses might hold right now.

From Heritage CEO to Slide

Slide, the insurance firm launched by former Heritage CEO Bruce Lucas, is set to assume 25,000 policies from Citizens, while Loggerhead plans to take up to 1,000 policies. These takeouts, albeit a small portion of the Florida Citizens portfolio, indicate the potential appeal of Citizens’ policies to growing companies. However, both companies will have to demonstrate sufficient reinsurance to support these new policy assumptions, which may prompt some additional buying, even though it’s likely this was under consideration prior to the mid-year renewals.

The Evolving Insurance Landscape

The decision to take out policies during hurricane season may also afford companies like Slide and Loggerhead the opportunity to be more selective in the risks they assume. Not all policies in Citizens’ book will be deemed as attractive to assume, and early picking from the portfolio could be a strategic move. In addition to Slide and Loggerhead, numerous carriers are taking steps to mitigate the frequency and inflation of claims by tightening up forms and wordings. Slide, for instance, has put in place endorsements related to roof damage claims to better manage its exposure to fraud and litigation in its claims experience.

The Future of Florida’s Property Insurance

The future of Florida’s property insurance market appears to be a balancing act. As certain insurers reduce their footprint due to escalating risk, other entities are recognizing opportunities in this space. The Citizens Property Insurance Corporation, once having a peak of 1.3 million policies in June 2023, has managed to depopulate its policy count to as low as 419,000 in October 2019, largely due to the depopulation program. However, the number has been steadily climbing, necessitating a restart of the depopulation strategy. While companies like Slide and Loggerhead have capitalized on this opportunity to grow, it’s yet to be seen how many other firms will follow suit. The ongoing hurricane season could potentially impact these dynamics, perhaps prompting a more significant depopulation effort once the season concludes. This trend will also be influenced by the extent of Insurance-Linked Securities (ILS) capital participation in the depopulation program. ILS capital could potentially offer an alternative way to back the portfolio of Florida risk, an approach previously employed during the last surge of takeouts from Citizens.

The Role of the State and Recommendations for Consumers

In this complex environment, the role of the Florida Legislature could be pivotal. This could pave the way for regular insurers to return to the market, providing more options for homeowners. In such a scenario, insurers would be liable for losses up to a predetermined ceiling, with the state-backed reinsurance covering losses beyond that limit. This system could provide more stability and predictability in a market that is grappling with the challenge of incalculable risks. In the meantime, Florida homeowners are advised to shop for insurance through an independent agent and to opt for a high deductible, the highest that their mortgage company will permit. By doing so, they can help mitigate what insurers refer to as ‘nuisance claims,’ making them less risky and less costly to insure.


In the midst of this evolving landscape, the Citizens Property Insurance Corporation’s depopulation program provides a unique avenue for companies willing to assume more risk. While the future of this market remains uncertain, the strategies adopted by various stakeholders, from legislators to insurers to consumers, will undeniably play a significant role in shaping the course of Florida’s property insurance industry. For a more detailed analysis of the evolving property insurance landscape, refer to www.insuranceanalysis.com/florida.

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