The board chairman of Citizens Property Insurance Corp. has called an emergency meeting of the board of governors in Tallahassee, Fla. Friday July 21 to discuss the dwindling builder’s risk insurance market. Citizens carries about 6,000 of the policies that cover about $4.5 billion in property under construction.
Florida’s insurer of last resort began scaling back its builder’s risk coverage July 15 after being asked by the Office of Insurance Regulation to justify writing the policies.
“I am responding to the grave concern expressed by CFO Tom Gallagher in a letter to me about the lack of builder’s risk insurance in Florida,” Bruce Douglas, Citizens board chairman said.
After the OIR request, Citizens officials told state regulators they could find no specific statutory provision requiring Citizens to write builder’s risk. Board members last month then voted to cancel the program.
In a July 14 letter to Douglas, Gallagher asked the board to “revisit (its) previous decision to non-renew and cancel builder’s risk policies” because “there is no viable private sector coverage available.”
Gallagher said because OIR had not specifically ordered Citizens to stop writing the policies, he believed “this coverage should continue to be made available through Citizens.”
Douglas said the board would “address this very serious issue and attempt to come up with some solutions.”
Source: Citizens Property Insurance Corp.
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