More about Citizens Insurance Survival

Oct. 2, 2015

Few owners switch insurance through clearinghouse

By early 2016, four more insurers are set to join 14 others in a clearinghouse that boots renewing customers out of state-run Citizens Property Insurance Corp. if a private carrier offers coverage for the same price or less.

Still, the computerized clearinghouse used by agents, launched in 2014, so far has sent far fewer customers to private insurers than traditional "takeout" offers companies mail to Citizens policyholders.

To date, 2,388 policies have not been renewed out of nearly 600,000 at Citizens by way of the clearinghouse, records prepared for a Citizens board meeting Wednesday show.

That's nowhere near the 141,680 who have left this year through transfer offers sent by mail, though the acceptance rate for those offers has dropped below 50 percent this year from 70 percent in 2014.

Scheduled to join the clearinghouse in the first quarter of 2016 are Edison Insurance Co., Monarch National, Southern Fidelity Insurance and Southern Fidelity Property & Casualty.

Citizens officials say there is reason to think the clearinghouse itself may be driving takeout offers, because insurers have been prodded to extend offers through state-approved letters rather than wait for a clearinghouse resolution where the customer premium might be lower.

About 40 percent of the company's policies have not passed through the clearinghouse because they have been targeted for takeout offers, said Adam Marmelstein, who oversees the clearinghouse for Citizens.

CEO Barry Gilway told the Citizens board Wednesday the company continues to play "whack-a-mole" with a host of challenges including water-loss claims in Miami-Dade County.

But he expects the company to keep getting smaller, regardless of the exit ramp customers may take. Executives have estimated if Florida's decade-long hurricane reprieve continues, the Citizens customer count could fall as low as 450,000 next year from a high of 1.5 million in 2012.