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FLORIDA - Florida’s state-run insurer, Citizens Property Insurance, is shedding tens of thousands of policies as private companies return to the market, signaling a major shift in the state’s fragile property insurance system.
Citizens reported having just under 778,000 active policies last Friday, the lowest total since mid 2021 and a sharp decline from more than 820,000 policies the previous week.
The drop comes as part of an ongoing state-backed effort to reduce Citizens’ role and redirect homeowners toward private insurers.
President Tim Cerio told the company’s board on Wednesday that the number of policies may briefly rise during hurricane season but is expected to fall below 654,000 by year’s end.
The reason: Florida’s depopulation program is ramping up again in the fall.
Under this plan, private insurers are allowed to assume control of policies that meet their criteria.
Citizens ballooned in recent years, topping 1.4 million policies in 2023, as private companies struggled with financial pressure.
Lawmakers passed reforms in 2022 to curb lawsuits and stabilize the market.
Those changes included eliminating a rule that forced insurers to cover homeowner legal fees when sued over denied claims.
Some legislators pushed to revise the rule again this year, proposing a “loser pays” system, but the bill died in the Senate.
Cerio said the private market is showing signs of recovery, but board member Charlie Lydecker cautioned that consumers won’t benefit until rates begin to stabilize.
Rate increases for Citizens customers were approved earlier this year.