Florida’s largest insurance provider drops nearly 200,000 policies, forcing homeowners to seek new coverage

Thousands of Floridians face rising insurance premiums and limited options as the state's biggest insurance provider cancels many policies

Florida’s largest insurance company recently canceled nearly 200,000 policies, leaving thousands of homeowners to seek new coverage in an already challenging market. Following recent destructive hurricanes like Helene and Milton, policyholders are now dealing with the dual challenge of finding affordable coverage while grappling with rising premiums. This decision has stirred concern statewide, as Floridians navigate a rapidly shifting insurance landscape marked by higher costs and limited options.

For some policyholders, these cancellations mean returning to the marketplace under more difficult circumstances. Fort Myers resident Livia expressed her frustration with the rising cost of her home insurance premiums. Earlier this year, after being dropped by her private insurer, she and her husband had no choice but to switch to Citizens, which was their only option at the time.

Now, they are once again faced with the challenge of finding new coverage, as they’ve received an offer from a different insurer that comes with an 18% increase over their current rate. Since purchasing her home in 2022, Livia’s premiums have skyrocketed by 300%, making it even harder to manage costs. The only alternative available to them is a smaller, relatively unknown insurance company, which has caused Livia to worry about the reliability of their coverage.

Rising insurance costs impacting Floridians

The policy cancellations have led to rising premiums for many Florida residents, but some homeowners are finding new options. Doug Nellans, an insurance agent based in Fort Myers, has observed this shift among his clients as a result of the citizen's takeout. While many policyholders are still grappling with increased rates, Nellans notes that a number of his clients are seeing offers from multiple insurers that are closer to what they were paying with Citizens.

For most, the price hike is manageable, typically ranging from $50 to $100 annually. This shift marks a significant improvement from previous years, where alternatives often came with steep price increases. The availability of more competitive offers is a welcome change for homeowners in Florida’s challenging insurance market.

With more insurance companies re-entering the Florida market, the current landscape differs from recent years, when many insurers withdrew due to hurricane-related risks. The return of private insurers is offering homeowners a wider selection and helping moderate extreme premium increases. Still, the demand for coverage far exceeds what’s available, and moderate rate hikes may continue as companies work to manage risks and offer affordable coverage.

An uncertain future for Florida’s insurance market

With Citizens’ policy count dropping from 1.2 million to just over one million, this recent shift is significant, yet industry experts suggest that further “takeouts” may occur before the year ends. If additional cancellations arise, it could lead to even more difficulties for homeowners, impacting not only their premiums but also the overall housing and insurance markets in Florida. As residents brace for potential changes, Florida’s insurance market faces the ongoing challenge of balancing affordable premiums with dependable coverage in a state that experiences frequent natural disasters.

Nellans is cautiously optimistic, noting that the increase in private insurers brings hope for more competitive rates, although the risk of more policy cancellations and higher premiums persists.

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