Meeting Notice — Insurance & Banking Subcommittee, House of Representatives (October 16, 2019)
Summary
Meeting packet for the Insurance & Banking Subcommittee of the Florida House of Representatives Commerce Committee, Wednesday, October 16, 2019, 3:00 pm - 5:00 pm, in Sumner Hall (404 HOB), chaired by Byron Donalds with Jose Oliva as Speaker. The notice lists a status report on recent hurricane property insurance claims, an update on the financial strength of property insurers in Florida, and an overview of Citizens Property Insurance Corporation. Commissioner David Altmaier's Office of Insurance Regulation slides report 1,002,821 statewide Hurricane Irma claims as of 11/14/2018 and 17,347 open Hurricane Michael claims as of September 27, 2019. The agenda also lists Greg Thomas and Toma L. Wilkerson of the Department of Financial Services and Barry Gilway of Citizens.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
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“Meeting Notice — Insurance & Banking Subcommittee, House of Representatives (October 16, 2019).”
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Insurance & Banking
Subcommittee
Wednesday, October 16, 2019
3:00 pm - 5:00 pm
Sumner Hall (404 HOB)
Jose Oliva Byron Donalds
Speaker Chair
Committee Meeting Notice
HOUSE OF REPRESENTATIVES
Insurance & Banking Subcommittee
Start Date and Time: Wednesday, October 16, 2019 03:00 pm
End Date and Time: Wednesday, October 16, 2019 05:00 pm
Location: Sumner Hall (404 HOB)
Duration: 2.00 hrs
Status Report on Recent Hurricane Property Insurance Claims
Update on the Financial Strength of Property Insurers in Florida
Citizens Property Insurance Corporation Overview and Update on Current Operations
NOTICE FINALIZED on 10/09/2019 3:42PM by Harrell.Lindsey
Leagis ® Page 1 of 1
10/ 09/ 2019 3:42:42PM
The Florida House of Representatives
Commerce Committee
Insurance & Banking Subcommittee
Jose R. Oliva Byron Donalds
Speaker Chair
AGENDA
October 16, 2019
404 House Office Building
3:00 PM - 5:00 PM
I. Call to Order & Roll Call
II. Hurricane Claims and Property Insurance Update
David Altmaier, Commissioner
Office of Insurance Regulation
Ill. Department of Financial Services
• Hurricane Michael: Consumer Data
Greg Thomas, Director of Consumer Services and Insurance Agency &
Agency Services
• Division of Rehabilitation and Liquidation
Toma L. Wilkerson, Division Director
IV. Citizens Property Insurance Corporation Overview
Barry Gilway, President/CEO and Executive Director
V. Adjournment
303 House Office Building, 402 South Monroe Street, Tallahassee, Florida 32399-1 300
(850) 71 7-4871 Fax: (850) 413-041 9
Hurricane Claims and Property Insurance Update
Florida Office of Insurance Regulation
Florida House Insurance & Banking Subcommittee
David Altmaier, Commissioner
Office of Insurance Regulation
October 16, 2019
1
Florida Office of Insurance Regulation
OIR Overview
[OIR Functions]
2
Florida Office of Insurance Regulation
Hurricanes Irma, Michael, and Dorian - Estimated Insured Losses
$12,000,000,000
$10,000,000,000
Hurricane Irma:
$8,000,000,000
$11,082,199,367 as
of 11/14/2018
$6,000,000,000
Hurricane Michael:
$7,158,922, 772 as of
$4,000,000,000 9/27/2019
Hurricane Dorian:
$2,000,000,000
$19,006,179 as of
10/7/2019
$0
Hurricane Irma Hurricane Michael Hurricane Dorian
3
Florida Office of Insurance Regulation
Hurricanes Irma, Michael, and Dorian - Statewide Claims Reported
1,200,000
1,000,000
Hurricane Irma:
800,000
1,002,821 as of
11/14/2018
600,000
Hurricane Michael:
149 ,448 as of
400,000
9/27/2019
200,000
Hurricane Dorian:
5,764 as of
10/7/2019
0
Huricane Irma Hurricane Michael Hurricane Dorian
4
Florida Office of Insurance Regulation
Hurricanes Irma and Michael - Statewide Claims Reported
Hurricane Irma* Hurricane Michael*
SUM(N""'be< of Clo oms I To tal Cl aims Re po rted
.c==::::!- •
:oo - 28.000
_oo 89.500
*Claims Data as of November 14, 2018 *Claims Data as of September 27, 2019
*Claims by County not reflected due to asserted Trade Secret protection. 5
Florida Office of Insurance Regulation
Hurricanes Irma, Michael, and Dorian - Percentage of Claims Closed
100.00%
90.00%
80.00%
70.00%
Hurricane Irma:
60.00%
92.4% as of 11/14/2018
50.00%
Hurricane Michael:
40.00%
88.4% as of 9/27 /2019
30.00%
Hurricane Dorian:
20.00%
62. 7% as of 10/07/2019
10.00%
0.00%
Hurricane Irma Hu rricane Michael Hurricane Dorian
6
Florida Office of Insurance Regulation
Hurricane Michael Open Claims Analysis as of September 27, 2019
Total Number of Ope n Claims • • • • • • • • • • • • • • • • • 17,347
Open Claims Th at Ar e Re-o pened Claims 9,330
Open Claims In Litigation 3,313
Open Claims with a n Assignm ent of Ben efit s _ 2,996
Open Claims In Appr aisa l 553
Open Claims That Ar e Both Wind and Flood Claims 191
Open Claims In M edia tion 15
Op en Claims In Arbitr ation 58
Total Number o f Op en Personal Residential Claims 12,145
Open Pe rso na I Resid en tia I Oa ims Wh ere Actua I cash Valu e
Has Bee n Paid Whil e W aiting fo r Additi o na I Repair Exp e nses 4,415
to Be Incurre d As W o r'k Is Perfo rm ed
7
Florida Office of Insurance Regulation
Market Conduct
• The conduct of Florida insurers in the marketplace is subject to oversight and
investigation by the OIR.
• The OIR receives and reviews market data from a variety of sources, but relies heavily on
consumer complaint data referred to the OIR by DFS's Division of Consumer Services and
data collected through catastrophe reporting data calls.
• The OIR has been consistently monitoring Hurricane Michael claims activity since it
made landfall and has taken investigatory action on a number of insurers. These
investigations found no violations of Florida law but recommended improvements to
their internal processes and controls.
• The OIR has initiated targeted market conduct examinations on seven insurers and
continues to evaluate Hurricane Michael claims response for every insurer. These
targeted market conduct examinations are confidential under Florida law until
completed.
8
Florida Office of Insurance Regulation
State of the Market
Composition of Admitted Residential Property Insurance Market
Policies in Force 2006-2 018
100%
90%
80%
70%
Citizens
60% • Fo reign
• Domestic
50%
40%
30%
20%
10%
0%
,,c:s~ ,,r:::i~
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');
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'); ,,r:::i '); ,,r:::i..."" <:::,..::,
');
,,r:::i~ ,,r:::i ,,r:::iv- ,,r:::i--.;
9
Florida Office of Insurance Regulation
State of the Market
Performance of Florida Domestic Property Insurance Companies
2006-2018
$1200. M
$1000. M
Q)
$800. M
E
0
u $600. M
E
...,
Q)
z $400. M
"C
c
I nl nl 111 111 111
$200. M
-
ro
I
Vl
r ~·
c
ro I
0-
$. M - LJ LJ
tD
~
I LJ
..., ($200. M}
=i
Q)
Z ($400 . M}
($600. M}
($800. M}
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
D Net Underwriting Gains •Net Income
10
Florida Office of Insurance Regulation
Florida Specialty {FS)
OIR's Priorities
• Protect consumers; especially vulnerable during hurricane season.
• Continue to foster the development of the private insurance market.
• Given the hazardous financial condition of this company, the OIR's primary
concern was to facilitate a solution tthat protects consumers and provide a
mechanism for guaranteed coverage and payment of existing policyholder
claims.
• This resulted in a comprehensive policyholder protection plan for all FS
policyholders who were first urged to seek coverage in the private market but
then guaranteed coverage with Citizens Property Insurance Corporation if
private market coverage was not available.
11
Florida Office of Insurance Regulation
Contact Information
David Altmaier, Commissioner
David.Altmaier@floir.com
(850) 413-3849
Mike Vaworsky, Chief of Staff
Mike.Yaworsky@floir.com
(850) 413-5000
Caitlin Murray, Director ~of Gover"'n me nt Affairs
Caitlin.Murray@floir.com
(850) 413-5005
For more information visit www.floir.com .
12
Hurricane Michael: Consumer Data
. . - - - - - - - - - DEPARTMENT OF FINANCIA L SE RVIC ES - - - - - - - - -
Consumer Resources
• Consumer and media alerts with pre-storm preparation tips and post-
storm recovery guidance
• CFO media tour to share information
• DFS Hurricane Michael Resources webpage
• Insurance Villages
• Insurance Consumer Helpline: 1-877-MY-FL-CFO (1-877-693-5236)
. . _ _ - - - - - - CFO JIMMY PATRONIS - - - - - -....
2
. . - - - - - - - - - D E PARTMENT OF FINANC I AL SE RVIC ES - - - - - - - -..
Helpline Calls
• Hurricane Michael insurance-related calls: 2,671
• 42% general information and claim process questions
• 41% concerns with a delay in handling of claims, such as prolonged delays or no
follow-up or response from the company
• 9% policy coverage questions
• 7% claim denial, cancellation, or policy non-renewal issues
• Complaints against an insurance company: 1,791
• 59% complaints regarding claim handling/adjuster delay
• 39% complaints regarding claim denial, claim underpayment, or unsatisfactory
claim settlement offer
. . . . _ - - - - - - CFO JIMMY PATRONIS - - - - - - _ .
3
....- - - - - - - - DEPARTMENT OF FINANC I AL SE RVIC ES - - - - - - - -..
Helpline Ca Ils
• Hurricane Irma insurance-related calls: 11,144
• 51% general information and claim process questions
• 28% concerns with a delay in handling of claims, such as prolonged delays or no
follow-up or response from the company
• 9% policy coverage questions
• 12% claim denial, cancellation, or policy non-renewal issues
• Complaints against an insurance company: 9,787
• 29% complaints regarding claim handling/adjuster delay
• 69% complaints regarding claim denial, claim underpayment, or unsatisfactory
claim settlement offer
. . . _ - - - - - CFO JIMMY PATRONIS - - - - - - - - -
4
- - - - - - - - - DEPARTMENT OF FINANCIAL SERVICES - - - - - - - - -
Working with Insurers
• Partnering with Office of Insurance Regulation
• Regular Calls and Contact with Florida Insurance Companies to share
expectations
• Insurance Villages in Impacted Areas
• Insurance Consumer Advocate engagement
. _ _ - - - - - - CFO JIMMY PATRONIS - - - - - - - - -
5
. . - - - - - - - - - D E PARTMENT OF FINANCIAL SE RVIC ES - - - - - - - - -
Questions?
DFS Legislative Affairs Office: (850) 413-2863
. . _ _ - - - - - - CFO JIMMY PATRONIS - - - - - - -6
Division of Rehabilitation & Liquidation
. . - - - - - - - - - DEPARTMENT OF FINANCIAL SE RVIC ES - - - - - - - - -
Division of Rehabilitation and Liquidation
• DFS serves as the court-appointed Receiver of any insurer placed into
receivership in Florida.
• The Division plans, coordinates, and directs the receivership
processes on behalf of the Department
• Governed by Chapter 631, Part 1, Florida Statutes
. _ _ - - - - - - CFO JIMMY PATRONIS - - - - - -...
2
- - - - - - - - - DEPARTMENT OF FINANCIAL SE RVIC ES - - - - - - - - -
Division Overview
Accounting Legal Estate Information
Department Department Management Technology
Human Administrative Claims
Resources Services Department
• Employees are paid out of the estate assets managed by the Division
Employees are members of the FRS
• Currently have 9 insurers in liquidation and 1 in rehabilitation
• Currently managing approximately $200 million in estate assets
- - - - - - - - - - CFO JIMMY PATRON IS - - - - - -....
3
- - - - - - - - - D E PARTMENT OF FINANCIAL SE RVIC ES - - - - - - - - -
Abbreviated Statutory Requirements
• Petition Court for Receivership • Evaluate claims filed
• Take possession of the company • Liquidate all property
• Notify Guaranty Association • Collect all receivables
• Notify agents of liquidation • Bill amounts due
• Send claim notices • Distribute assets to claimants
. . . _ - - - - - - CFO JIMMY PATRONIS - - - - - -...
4
- - - - - - - - - DEPARTMENT OF FINANCIAL SE RVI CES - - - - - - - -..
Liquidation Process
• Bank accounts are changed and data • Sell real and personal property, collect
is backed up and secured any amounts due to company
• Continue critical operations of the • Conduct investigation on options for
company potential recoveries
• Migration of data from company to • Litigate any matters related to
Division potentia I recoveries
• Coordinate with the Guaranty • Evaluate and pay claims with available
Association assets, if any
- - - - - - - - - - CFO JIMMY PATRONIS - - - - - -...
5
. . . - - - - - - - - - D E PARTMENT OF FINANC I AL SE RVIC ES - - - - - - - - -
Priority of Distributions
• Class 1 Department's administration expenses & Guaranty
Association's claims handling
• Class 2 Policyholder losses & Guaranty Association losses
• Class 3 Policyholder unearned premium
• Class 4 Federal Government
• Class 5 Employees of the company
• Class 6 General creditor
• Class 7 State or local government
• Class 8 Late filed claims
• Class 9 Surplus notes
• Class 10 Interest on above claims
• Class 11 Shareholders
. . _ _ - - - - - - CFO JIMMY PATRONIS - - - - - -....
6
.....- - - - - - - - DEPARTMENT OF FINANCIAL SERVICES - - - - - - - -..
Florida Specialty Insurance Company
• Property insurer writing personal property insurance
• 88,963 policyholders
• Ordered liquidated on October 2, 2019
• Agent notices sent on October 3, 2019
• Policyholder notices sent on October 4, 2019
• Approximately 2,200 open claims
• More than 100 new claims received since October 2, 2019
• Coverage ends on November 1, 2019
. . . . _ - - - - - - CFO JIMMY PATRONIS - - - - - -.....
7
. - - - - - - - - - DEPARTMENT OF FINANCIAL SE R V IC ES - - - - - - - - - .
Florida Specialty Insurance Company
YOUR OPTIONS
- - - - - - - - - - CFO JIMMY PATRONIS - - - - - -....
8
- - - - - - - - - DEPARTMENT OF FINANCIAL SERVICES - - - - - - - - -
Questions?
DFS Legislative Affairs Office: (850) 413-2863
- - - - - - - - - CFO JIMMY PATRONIS - - - - - -...
9
Citizens Property Insurance Corporation Overview
~ITIZENS PHOPERTY INSURANCC CORPORATION
1,200,000
Liquidation of 3 FL domestic
carriers and partial withdrawal High volume of
Liquidation of Poe
Personal Lines Account from large carrier depopulation activity
Financial Group
~
1,000,000 Coastal Account 1
J!!c 800,000
::::,
0
• Commercial Lines Account
I High volume of
depopulation activity
r - ---l 1
r 1
u
High volume of
-~ 600,000 depopulation activity
0
a. ,-------1
'
400,000
200,000
0
1996 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 03 2019
I
c_,..
Personal
Lines Account
Coastal
Account UnesAccount
Talill
Personal
UnesAccount
Coastal
Account
--·--
Unu Account
Total
19N 936,837 465,739 0 1,402,576 2010 829,406 44 5,679 8,453 1,283,538
2001
- 102,792 414,123
~
198 517,113 2011 - 1,003,856 460,161
- 8,374 1,472,391
- - - -
2002 164 ,274 397,676 2,157 564,107 2012 860,502 446,163 8,146 1,314,811
2003
- 383,283 433,077
- 3,863 820,223 2013
- 627,391 386,688
- 7,615 1,021,894
- - - -
2004 416,521 453,765 3,650 873,936 201, 373,617 282,863 4,681 661 ,161
2006 407,387 399,417
-· 3,145 809,949 20115 - 299,902 200,842
- 3,121 503,885
- -
200142l 743,592 403,509
-
8,347 1,298,428 2018 293,118 160,834 1,891 455,843
2007 1,304,949 2017 440,408
2008
845,857
629,467
446,184
445,200
12,908
9,570 1,084,237 2011
300,507
304,507
138,591
121 ,971
- 1,308
919 427,397
2009 609,652 410,436
- 9,126 1,029,214 Q32011 302,864 117,701
- 767 421,332
Notes:
1) Excludes takeout policies Page 2
2) In 2006 there were 142 980 policies assumed from the Poe Financial Group included in Citizens' total policy count As these policies remained on the Poe system at the
end of that c alendar year, they are not allocated at the acc ount level
~ITIZENS PROPERTY INSURANCE CORPORAllON
Market Share Based on Total Insured Value
For Policies that Include Wind Coverage
Florida Residential Property Insurance Market
Includes Trade Secret Insurers
QUASR Data as of March 31 , 20 19
June 30, 2004 December 31 , 201 1
. Florlcla-
BNed
. Florlda-Based
45%
720/o
Insurer Total Insured Value
Citizens $101,793,657,175
"Pups" $233,717,913,073
Florida-Based $1 ,650,07 4,339,052
Others $309. 172.319.098
Total 294.768.228.398
The Florida Residential Property Insurance Admitted Market is divided into 4 major parts: (i) Citizens; (ii) Florida
only subsidiaries "pups" of major national writers; (iii) Florida-based domestic companies; and (iv) non-domestic
nationwide property writers, such as USM, etc.
Not.es:
I ) Includes admitted insurers only
2 ) E.st1mates for n surers sw,m 1tt1ng data unde, , rade Secret" protedlc,n are detailed in the Data Sou= sec<ic,n of the COfJ)Orate Anaiylics Mart et Shan, R._i
3 ) Surplus knes oompanies are not included n the marte,1 share cala.daton
Page 3
4 ) Based on total insured value for policies wtth wnd cove.age
'<I"
QJ
Ol
C'O
Cl..
;
ft
.-t
.-t
0
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Cll
0...
~ ITIZENS
PROPERTY INSURANCE CORPORATION
What Caused Citizens' growth?
By 2011, Citizens peaked at - 1.5 million policies.
Challenges to private market profitability:
• 2004/2005 hurricane seasons
• Sinkhole crisis
• Unfavorable litigation environment
• Generally low profit margin in Florida
• Increased cost of reinsurance
National/regional carriers exited or restricted writing.
• Market share reduced from 63°/o in 2004 to 32o/o in 2011.
Page 6
~ ITIZENS
PffOPER1" INSURANCE CORPORATION
What changed?
From 2011 to 2019, Citizens' policy count reduced from an all-time
high of -1.5M policies to -420k policies.
• Low reinsurance rates
• New Florida domestic carriers/programs entering the market
• Elimination of ceding commissions encouraged domestic
earners
• Robust depopulation of Citizens policies
• Increased competition and several years of rate decreases
• 10 years without significant hurricane activity (2006-2015)
Florida domestic carriers experienced significant growth.
• Market share increased from 45°/o in 2011 to 72°/o in 2019.
Page 7
~ ITIZENS
PROPERTY INSURANCE CORPORATION
Hemudo, Palm Beacb,
Hilsborough, Broward & Miami-
Veer Pasco & Pinellas Dacie Statewide
Personal Residential Market Share 2011 I 41% 34% 19%
by Total Insured Value 2012
2013
I 35%
23%
29%
21%
15%
'11%
2014 14% 13% 7%
45%
2015 11% 10% 5%
2016 10% 10% 4%
40%
2017 10% 10% 4%
2018 10% 9% 4%
1Q 2019 10% 9% 4%
35%
.
(I)
(D
.s::.
30%
- Hernando, ,Hilsbci-ou!IJ . Pasco & Pilelas
(J)
25%
ai - Pam Beach, Brow..-d & Miami~Dade
.:.::
.....
(11
::? 20%
Statewide
>
j::
15%
10%
5%
0%
2011 2012 2013 2014 2015 2016 2017 2018 Q1 2019
Page 8
~ ITIZENS
PROPEA'l'Y INSURANCE CORPORATION
Citizens has at its disposal both the traditional resources available to all property
and casualty companies that conduct business in the state as well as assessment
powers granted to Citizens by law.
• Insurance Premiums • Citizens' Policyholder Surcharges
• Investment Income • Regular Assessments (Coastal only)
• Operating Surplus from Prior Years • Emergency Assessments
• Florida Hurricane Catastrophe Fund Reimbursements • Pre-event liquidity resources (debt issuances and lines of
• Traditional Reinsurance and Capital Markets Risk credit which, if drawn upon, must be repaid)
Transfer
Page 9
~ITIZENS
PROPOTY INSURANCE CORPORATION
Citizens Policyholder Surcharge
Up to 15% per account for Coastal Account, PLA, and/or CLA deficits
Applies at new business/renewal for all Citizens' policyholders
Regular Assessment
Up to 2% for Coastal Account deficits
Applies at new business/renewal for all non-Citizens' policyholders
3.
Emergency Assessment
Up to 10% per year per account for Coastal Account, PLA and/or CLA deficits
Applies at new business/renewal for all Citizens' and non-Citizens' policyholders
Page 10
~ ITIZENS
• The 2005
Emergency
2005 HRA
Hurricanes Dennis,
Katrina, Rita, Wilma
$163 million* $1,384 mi llion I Assessment was
terminated for
2004 jl HRA
I Hurricanes Charley,
Frances, Ivan, Jeanne II 515.4 million II I policies issued or
Hurricane Georges and
I
renewed beginning
1998 HRA
Tropical Storm Mitch
100.0 mi llion i:
--, - - on July 1, 2015
·1r "
1995 II PLA I Hurricane Opal
1995 HRA Hurricane Opal 84.0 mil lion
• Currently, no
1995 HRA I Hurricane Erin II 33.0 million JI I
assessments are
1994 PLA Non-hurricane 17.7 million I being levied by
1993 II HRA I Winter Storm II 3.2 million JI Citizens
1992 HRA Hurricane Andrew 16.2 million
I
- -
1985 I~ HRA - J Hurricane Elena
ii
1975 HRA Hurricane Eloise 5.0 million
• 2005 Regular Assessments were eliminated in the PLA/CLA and reduced in the HRA due to the receipt of a Page 11
$715 million, one-time appropriation from the Legislature.
~ITIZENS PROPEATT INSURANCE CORPORATION
Surplus 1 $6.3 $6.2 $6.4 Total Premium lnforce $849M 0.4% -3.1%
100-YR PML2 $4.5 $4.7 $5.2 Average Premium - PLA $1 ,757 0.1% 4.0%
Claims-Paying Capacity 3 $11.0 $11.5 $11 .9 Average Premium - Coastal $2,590 0.2% 1.0%
Total Cash and Invested Assets 4 $8.9 $9 .3 $10 .1 Averaqe Premium - CLA $15,995 0.1% -2.9%
1 Accumulated Surplus is determined in accordance with Statutory Accounting Principles (SAP). Values for 2017 and 2018 are audited; 2019 is unaudited as of August.
2 Occurrence Probable Maximum Loss ("PML") includes demand surge , excludes storm surge , and does not include LAE . Values for 2017 and 2018 are year end ; 2019 is June month end .
3 Claims Paying Capacity consists of (1) Statutory Surplus, (2) risk transfer for storm season (including FHCF coverage) and (3) par value of pre-event bonds. Please note that this figure
shows resources on a combined basis . However, resources are specific to each account and may not be used to fund needs in another account.
4 Total Cash and Invested Assets for 2019 are as of August
• While Citizens continues to have a healthy financial position, the PLA has had net losses in
multiple years:
• Through August 2019 (unaudited): $25,468,000
• 2018 (audited): ($135,861 ,000) *
• 2017 (audited): ($555,475,000) **
• 2016 (audited): ($35,017,000)
• 2015 (audited): ($21,489 ,000)
* Due to Hurricanes Michael and Irma
**Due to Hurricane Irma
Page 12
~ITIZENS PROPERTY INSURANCE CORPORATION
Public Summary of Citizens Assessment Reduction Efforts Over Time
201 1 2012 2013 2014 2015 2016 2017 2018 2019
Storm Risk Storm Risk Storm Risk Storm Risk Storm Risk Storm Risk Storm Risk Storm Risk Storm Risk
$24.52 B $24.00 B $19.31 B $16.15 B $10.18 B $7 .66 B $6.11 B $5.73 B $5.21 B
Dep.ep91eti- Hiil (te.33 B)
o.p.-,91'-PMI.
(13.HII)
.,.~......... NOT DRAWN
TO SCALE
(14,.518)
,.........
lhpeP91. . . . . .
1-100 Su r plu s Exposed(%)
Coastal 100% 100% 100% 100% 57% 61% 40% 34% ~ 31 %
PLA/CLA 100% 100% 100% 77% 39% 31% 27%
I 31'4
55"
7'o
---, 29%
54% PLA .
5" CLA
~l
Notes:
1. Storm Risk is as measured by 1-in-100 year probable maximum loss (PML) plus estimated loss adjustment expenses using the Florida Hurricane Catastrophe Fund (FHCF) account
allocation where PLA and CLA are combined . PLA/CLA combined PMLs are added to the Coastal PMLs to be consistent for surplus distribution . In general , the PMLs presented are
as projected at the beginning of storm season ; with the exception of 2017 which is as of August 31 , 2017.
2. Surplus and Assessments are as projected at beginning of storm season . Not all PLA/CLA surplus is needed to fund storm risk in 2014. In 2015 - 2019, not all surplus in PLA/CLA and
the Coastal Account is needed to fund storm risk. Remaining surplus is available to fund a second event.
3. Florida Hurricane Catastrophe Fund (FHCF) is as projected at beginning of storm season ; with the exception of 2017 - 2019 which are Citizens' initial data submission to the FHCF .
4. Depopulation PMLs are not included in storm risk totals and are presented as year end totals . As of Sept 30th , 2019 depopulation PML is -0$.048 and is not shown on chart
5. PMLs from 2011-2014 use a weighted average of 1/3 Standard Sea Surface Temperature (SSST) and 2/3 Warm Sea Surface Temperature (WSST). 2015 - 2019 PMLs reflect only
SSST event catalog . Page 13
~ ITIZENS
PROPERTY INSURANCE CORPORATION
• Under Florida law, Citizens may write a new insurance policy only for property that
meets one of the following eligibility criteria:
• Coverage is not available from a Florida-authorized insurance company
• Premiums for coverage from Florida-authorized insurance companies are
more than 15 percent higher than the premiums for comparable coverage
from Citizens
• In 2013 the legislature created a Property Insurance Clearinghouse to help identify
private-market insurance options for consumers who believe Citizens might be their
only choice for property insurance and to ensure that only customers who are eligible
obtain coverage from Citizens
• Citizens' Depopulation Program, authorized by Florida law, matches Citizens
policyholders with insurance companies interested in removing their policy from
Citizens and providing private-market coverage for their policy. All companies
assuming policies from Citizens have been approved by the Office of Insurance
Regulation (OIR)
Page 14
~ ITIZENS
PROPERTY INSURANCE CORPORATION
Policies Taken Out Relative to Citizens' lnforce Policies
45.0%
40.8% 41 .3%
40.0% • Assumed Policies as % of Pri or
Year's Total Pol icy Count
350%
• Assumed T IV as % of Prior
30.0% Year' s Total TIV
250%
200%
150%
10.0%
5.0%
0.9% 0.5%
0.0%
201 1 2012 2013 2014 201 5 2016 2017 2018 02 201 9
YNr ........
Totlll
ColnpMIN
Totll
Pollc:iN
--d
CltlUM
Inion»
PolciN
AaullNNIPolciN
a%fJIPrtor
Y_.• Totll Poley
Count
,.... ......... Vllue
(TIV)ANmned
CltlUM lnfon:e
MlameclllV•
Totll lneunld v... % fJI Prtor y_..
Totll 11V
2011 3 53,577 1,472 ,391 4.2% $14 ,473,700,490 $510,675 ,120,913 3.1o/o
2012 7 277 ,002 1,314 ,811 18.8% $75 ,927 , 165,347 $429,424 ,399, 130 14 .9%
2013 18 365,767 1,021 ,694 27 .8% $112,265,410, 122 $318,887 ,485,544 26 .1o/o
2014 21 416,623 661 , 161 40.8% $117 ,530,082,371 $201 ,957 ,396,325 36 .9%
2015 14 272,785 503 ,865 41 .3% $64 ,830,051 ,559 $150,495, 190,065 32 .1%
2016 11 88,000 455 ,843 17.5% $23,362 ,914 ,453 $124 ,063 ,055,743 15.5%
2017 7 34 ,008 440,406 7 .5% $7 ,435,411 ,434 $112 ,309 ,524 ,847 6 .0%
2018 4 17,905 427 ,397 4.1o/o $4 ,307,930, 768 $108,896 ,296 ,069 3.8%
Q22019 2 3,664 420,615 0 .9% $590,259,277 $107 , 115,372 ,245 0.5%
Page 15
Note : The number of assumed policies does not account for any opt-out polic ies reported after the assumption date
~ ITIZENS
PROPERTY INSURANCE CORPORATION
Claims Summary Total Commercial Personal
New Claims II 107 II 2 II 105
Closed Claims 77 1 76
% Closed · ~ [ _ ---·- 12% - -- -- iC~- 50%
-=ic 72%
Indemnity Paid $176,815 $0 $176,815
Expenses Paid
Total Incurred
-==Jc~-~ $58,379
$357,169
~I $0
$12,160
IC $58,379
$345,009
% Submitted by Self _JI- - 80% __JI 50% I'
:I
I
81%
% Submitted by Rep 7% 0% 7%
% Submitted by Other
% Storm Surge
r=== 13%
0%
==1,--- 50%
0%
~:=-c=j,:=~~ 12%
0%
-i-----~ ·- - . --- - --
,)
:1
%AOB ' 1% II 0% I. 1%
Data as of October 7, 2019
Page 16
~ ITIZENS
PROPERTY INSURANCE CORPORArlO N
Claims Summary Total Commercial Personal
New Claims L 3,6o9 11
59 JI
3,550
Closed Claims 3,328 53 3,275
% Closed ~~L---- 92% _jL 90% _JL 92%
Indemnity Paid $111,059,975 $9,382,065 $101,677,909
-- ---r
$4,347,770 JC $145,613 _J_ $4,202,156
~,~
Expenses Paid
Total Incurred $122,517,121 $9,810,691 $112, 706,430
% Submitted by Self ] [ ~ ~ 78% l[ ~~
-1~ - - 78%
53% ~.--- _______ ___ .
.._ ~ -
% Submitted by Rep 1% 14% 1%
% Submitted by Other JL____ 21% I 34%
-
I,
20%
% Storm Surge 5% 15% 5%
- w- - 6% -~,-----1--~------ 10% --~----·~ · ~ 6%
%AOB ,,
Data as of October 7, 2019
Page 17
~ ITIZENS
PROPCRTY INSURANCE CORPORATION
Claims Summary Total Commercial Personal
New Claims __ _JL 12,616 I 2,150
I 70,526
Closed Claims 65,858 1,873 63,985
% Closed
--------11-- 91% ,.,1
I 87%
~-~ [
I
-
91%
_L__
Indemnity Paid $1,328,650,442 $109,590,081 $1,219,060,361
,r-
Expenses Paid _-~---_~Jr $202,482,881 11
,: $10,932,521 :I $191,550,360
Total Incurred $1, 739,560,505 $162,624, 787 $1,576,935, 718
% Submitted by Self - ·11
60%
--
,,,. 33%
-T-- 61%
"
% Submitted by Rep 16% 10% 16%
% Submitted by Other i 24% I
57% !L_ 23%
% Storm Surge 4% 14% 4%
-- - -- - - - - -- - ,.
---------
%AOB I 11% i! 6% I 11%
Data as of October 7, 2019
Page 18
~ ITIZENS
PROPERTY INSURANCE CORPORATION
Claims Summary Total Commercial Personal
New Claims ___ _JL_ 3,367 --~J_'.~~ 194 !I
3,173
Closed Claims
% Closed
~ ---. - ·r· ~- - 98% ·~~Ji----- 96% ---~L- 98%
~
3,306
I
186
!
3,120
L__ -~
Indemnity Paid $26,539,213 $6,389,303 $20,149,909
Expenses Paid -----:1- $4,848,067 JC $720,398 ·- [ $4,127,668
Total Incurred $33,324,699 $7,709,245 $25,615,454
--r- -
% Submitted by Self
- -.r- ~-
I 69% -11 30% i 71%
% Submitted by Rep 3% 2% 3%
,
% Submitted by Other 29% II 69% 26%
----
% Storm Surge 0% 0% 0%
- - -- - -
%AOB I, 5% II 6% \
5%
Data as of October 7, 2019
Page 19
~ ITIZENS
PROPERTY INSURANC( CORPORATION
Claims Summary Total Commercial Personal
I
New Claims I 905 II 17 i 888
-·
Closed Claims 891 16 875
% Closed
---~- --T -- -
L_
98% --JI 94% - --- ---r-- ----
-
99%
Indemnity Paid $2,315,069 $153,923 $2,161,146
Expenses Paid - -----
_ _ _ .J -
·-r-- $1,099,733 I I $35,468 ---!I $1,064,265
- _ _JL~ -~~.-J ~-·----
Total Incurred $3,937,569 $350,391 $3,587,178
--- . --
;, 11
% Submitted by Self 71% ii 41% II 71%
% Submitted by Rep 3% 6% 3%
% Submitted by Other
- - -
26% -- ---- !~ -------- 53% ~L~ 26%
% Storm Surge
%AOB
- - -- - -. i
0%
4%
----,r---
----
:L
0%
0%
---
----11--- 0%
. 4%
Data as of October 7, 2019
Page 20
~ ITIZENS
PROPOTY INSURANCE CORPORATION
Claims Team Hermine Matthew Irma Michael Dorian
FNOL ~. ___ _l_ 1 - - · ! --··-- _ _JL__171 I! 11 II 21
Large Loss 1 5
Loss Assessment ,--------~I-·- - - · - - ---1r---·- 5 -----11·- 1
MH -Total Loss 2 18
j I
Mediation I 1· II 20 II 2
Appraisal 1 5 1,825 179 3
Litigation - AOB ! 2
- - - I.
,.
I·
I 8 ~[ 384
-~._jl_
r~- 13
- L__ --~-
Litigation 8 45 4,367 46 1
Subrogation .,
' I
i 76 I,, 2
Total Open 15 59 6,853 272 25
Data as of October 14, 2019
Page 21
~ ITIZENS
PROPERTY INSURANCE CORPORATION
On October 2, 2019, Florida Specialty Insurance Company was ordered into receivership by
the State of Florida . Florida Specialty policies will be cancelled effective November 1, 2019
at 12:01 a.m. and will cease providing homeowners coverage for approximately 91,000
Personal Lines customers.
Agent Communications
• Citizens has implemented expedited appointment and agency agreement
processes for Florida Specialty agents and agencies that are not currently
appointed with Citizens and want to do business with us.
• Beginning on or after October 14, Citizens will have an expedited new-business
application process for Florida Specialty customers which relaxes our eligibility
rules including the Property Insurance Clearinghouse and required document
procedures at this time. Agents must be appointed by Citizens to use this process.
• Citizens has scheduled four free webinars for Citizens-appointed agents to learn
about moving their Florida Specialty risks to Citizens.
• FAQ entries have been updated with all pertinent Florida Specialty information and
additional training materials are in development.
Page 22
~ ITIZENS
PROPl:RlY INSURANCE CORPORATION
Policyholder Communications
• All Florida Specialty customers received a notice from the Department of Financial
Services regarding the liquidation of Florida Specialty.
• Customers are encouraged to contact their agent to secure insurance coverage
prior to the cancellation of their policy to ensure continued, uninterrupted property
coverage.
• Regardless of whether their agent is appointed with Citizens, all Florida Specialty
policyholders have the option to accept Citizens' guaranteed one-year offer of
coverage if they are unable to secure coverage from the private market.
• Information was included in the notice to direct customers to the Citizens' website
page dedicated to Florida Specialty for additional details and a link to FAQs specific
to the Florida Specialty liquidation.
• Additional planned communication includes a letter explaining the initial invoice and
payment scenarios with Citizens.
Page 23
~ ITIZENS
PROP{RTY INSURANCE CORPORATION
Policy Counts by Form
DP-1 DP-3 II H0-3 II H0-6 HW-2 HW-6 II MH0-3 II Total
6,301 4,665 39,661 8,987 576 1,298 28,571 90,059
Agent Counts by Status
Appointed with Citizens JL 2,137
Not Appointed with Citizens 1,041
Total 3, 178
Pol icy_Type
• DP 1
• DP3
H03
• H06
• HW2
• HW6
MH3
OJ fS' •
Page 24
~ ITIZENS
PROP£RTY INSURANCE CORPORATION
The Process
FL Specialty to Florida Insurance Guaranty Association (FIGA)
FL Specialty to Citizens
Citizens uploads FL Agent reviews offer FIGA refund is
Specialty data and and premium with applied to Citizens
creates quote for customer to policy and customer
agent in our system determine if CPIC is is invoiced for
(PolicyCenter) the best fit balance
Off Ramps : UW Requirements &
• Changing Data Documents
• Adding a Mortgagee Temporarily Waived
• Application
• Inspections
• WLM
• RCE
~ITIZENS PROP(RJY INSURANCE CORPORATION
System (PolicyCenter)
• Quotes uploaded into • Agents can bind risks with Citizens
PolicyCenter. FIGA refund will come directly to Citizens and apply
• Activity generated on to new policy down payment.
agent desktop. Deadline of 10/31
Oct 10-11 Oct 14 - Oct 31
October
1 Oct 7-8 Oct 14-15 Oct 21
"Receiver Letter'' "Calming Email" "Process Email" "Webinars" "Halftime Report" Additional
To Customer: To Agent: Citizens To Agent: How to How to take To Agents: Policyholder
Letter from the is Ready to Help. take advantage of advantage of this Report of policies Communication:
this program. ~ r, Citizens will be
~
receiver regarding program . still not bound.
(for agents) '-z-' sending additional
whathas &-..
happened. 12::SJ "Data Files Email"
~1333 policyholder
communication after
To Agent: File to
risk is bound (post
each agent with 11 /1) regarding the
"Receiver Email"
their affected full, partial or zero
To Agent:
Email from the
policies. l333 premium posted
(different letter for
receiver regarding each scenario).
what has ~ Oct 28
happened. L..2..J
"Agent Decline Letter"
"Website Go-Live" To Customer: Citizens will send a "Two Minute
Citizens will stand up Florida Specialty webpage letter if the agent declines to be Warning"
www.citizensfla .com/floridaspecialty (public) appointed with Citizens. @I To Agents:
Report of policies
still not bound .
Communication & Education ~1333
File and source
- File
- 2019-10-16_3013_insurance-banking-subcommittee_meeting-packets_fn-ibs-10-16-19.pdf
- Size
- 17,021,203 bytes
- SHA-256
- 127e65313d85376ee60e01483f2a8fa693d2344ac61737e63a93fb1747ea6b3f
- Original
- No public link identified.