Florida’s property insurance market is experiencing a resurgence, marked by fresh entrants into the field and increased takeout orders from Citizens Property Insurance. Notably, two new insurers are making their debut, and HCI Group has announced its application for a substantial number of policies from Citizens.
Paresh Patel, CEO of HCI Group, headquartered in Tampa, revealed during an earnings call that the company has sought approval for up to 75,000 policies from Citizens in anticipation of the company’s 2023 policy announcement. HCI Group’s first-half profit surged to $33 million, a noteworthy improvement over the corresponding period in the previous year.
HCI’s chief financial officer, Mark Harmsworth, stated in a conference call, “Our previous earnings calls hinted at the substantial benefits we anticipated from Florida’s new legislation, which is now evidently making a positive impact on our results.” HCI Group encompasses Florida subsidiaries like Homeowners’ Choice Property & Casualty Insurance (with around 88,300 active policies) and TypTap Insurance (with approximately 56,000 policies). The entity insuring the Citizens policy remains uncertain.
Should Florida regulators endorse these policy transfers, the number of policies moved from Citizens this year might surpass 350,000. This development holds significance, given that Citizens, the state-established surplus insurer, has emerged as Florida’s largest property insurer with over 1.3 million policies.
In a recent announcement, Florida Insurance Commissioner Michael Yaworsky disclosed that Mainsail Insurance Co., a Texas-based insurer, has received approval to operate within the state. This follows the earlier approval granted to Tailrow Insurance, an HCI Group subsidiary, in April.
Additionally, Recoop Disaster Insurance, underwritten by Professional Solutions Insurance Co., shared plans to introduce a parametric property policy in Florida, providing a fixed payout of up to $25,000 following a storm.
Executives from Recoop were unavailable for comment, but Professional Solutions, based in Iowa, has been operational in Florida since 2019, as indicated by the Florida Office of Insurance Regulation (OIR) website. The company is part of NCMIC Insurance Co., initially a malpractice insurer for chiropractors that has since expanded to offer personal and business coverage.
These developments collectively indicate a stabilizing trend in Florida’s market, which had witnessed several years of surging premiums, carrier withdrawals, and numerous bankruptcies. Commissioner Jaworski hailed recent legislative adjustments in 2022 and 2023, which ended one-way attorney fees and the distribution of benefits in claims litigation, as “positive signs” contributing to these changes.
He affirmed, “Mainsail Insurance’s entry into the Florida market demonstrates the positive impact of recent legislative changes on consumers.”
Mainsail Insurance is part of Hippo Holdings Inc., overseeing Hippo Insurance and Spinnaker Insurance Co. Hippo Holdings, publicly traded and headquartered in California, saw the replacement of Co-founder Assaf Wand with Richard McCathron as CEO last year.
While Hippo Insurance is not yet active in Florida, the company has expanded its operations to encompass at least 15 states in recent years. Spinnaker, on the other hand, had approximately 57,000 active policies in Florida as of March, according to the most recent quarterly report from the Florida OIR.
