If you own a home in Florida and are insured with Citizens Property Insurance Corporation, you need to pay close attention. The Office of Insurance Regulation in Florida has approved Citizens' ability to shed tens of thousands of insurance policies. As a homeowner in Florida, this decision could have significant implications for you.

Understanding the Role of Citizens Insurance

Citizens Property Insurance was originally established by the state of Florida as the Property and Casualty Insurance Company of Last Resort. It was designed to provide coverage only for homeowners who couldn't find insurance elsewhere in the marketplace. Picture a pyramid: Citizens were intended to be at the bottom, supporting homeowners who had no other options.

However, over the past decade, changes in the insurance market, including the insolvency of some companies and the exit of others from the state, have pushed Citizens to the top of that pyramid. This shift means that Citizens now insure a far larger number of homeowners than initially intended.

The New Policy Shift: What It Means for You

The recent approval by the state allows Citizens to move to another insurance company if that company can offer similar coverage at a premium increase of no more than 20%. While this may sound straightforward, there are some crucial points you need to consider:

• Premium Increases: Many Florida homeowners budget carefully for their mortgage payments, which often include insurance premiums through an escrow account. What many don't anticipate is the potential for significant premium hikes when they are moved to a new insurer. While the initial rate might seem reasonable, it's not uncommon to see it double upon renewal.
• Escrow Account Shortfalls: If your premiums increase substantially, your escrow account may not have enough funds to cover the new amount, leading to higher monthly mortgage payments or a large lump-sum payment.

What Should You Do Next?

If you're currently insured with Citizens, it's essential to start planning now. Here are some steps you can take to protect yourself:

1. Consult with Your Insurance Agent: Begin by speaking with your current insurance agent. They can provide insight into what other options might be available and help you understand potential future costs.
2. Shop Around: Contact several different insurance agencies to compare policies. Don't settle for the first offer; exploring your options could save you money in the long run.
3. Prepare for the Unexpected: If your home has an older roof or other issues that might complicate finding new coverage, start setting aside funds now for necessary repairs or replacements.

We're Here to Help

Navigating these changes can be challenging, especially when you're faced with rising premiums and the possibility of being forced to switch insurers. If you have any questions or concerns about your insurance coverage, don't hesitate to contact the attorneys at Warner & Fitzmartin at (561) 816-5983. We're here to help you understand your options and take the necessary steps to protect your home and your financial future.