Nobody important, do you have any idea the situation Citizens and the state are putting all of us in. The best thing they are doing is approving these take-outs to get exposure out of Citizens. Insureds are 110% better off in these smaller private companies then they are with Citizens. Yes, some of them may have small amounts of capital but with their reinsurance programs and strict regulation, they are well run companies that usually dont overleverage. Citizens is extremely overleveraged and it will be a disaster when the BIG ONE hits.
I understand fully that Citizens is a joke and yet undercapitalized start ups are just as big a joke. If the politicians would stop grandstanding and let the market work, it might be handled. On the other hand, if you build in a wind tunnel, your structure will fall down on a regular basis. The politics in Florida regarding insurance is a joke. I don’t mean that in a funny way.
I would have a hard time saying that my clients were BETTER off with a take out carrier than with Citizens. Citizens will NEVER go bankrupt and never be the reason for a FIGA assessment. these other carriers are not financially sound to take on the exposure that they are and the OIR knows it. follow the money trail…
I suggest you read and learn more about the reality of the situation with the Cat Fund and what would happen in the event of a major storm. You should be able to recommend a take-out company over Citizens and feel comfortable with it. If you are simply an agent you may not know all of the background details as I do because I have been forming a company for 2 years and understand the setup and background details.
Citizens would be bankrupt after a major storm and would have to collect tax payer money to get them out of it. However, that being said, all of the start ups are in trouble as well due to the Cat Fund problems because there is not enough money there due to bonding issues with the credit crunch and certain layers of the reinsurance offered from the Cat Fund could be non-exsistent. We have major problems in this state that no politician is address because they simply care about popularity by keeping rates low. I truly hope new legislation is passed that helps stop what is setting up to be a disaster.
S Fl Agent, I think you misunderstand. I fully sympathize with you and the problems there. I admire the politicians in a perverse way. They have set Citizens up to fail and yet if they do it looks like the insurance industry at fault rather than the politicians. Who has to try to collect the outrageous assessments that would be required? The companies, which makes us the bad guys. I have said before it is one of the most perfect political dodges I have ever seen. They take the credit and none of the blame. My company has pulled out of property in Florida like most others. I well understand the catastrophe that is going to occur. I wish the people of the state understood. I just don’t think lightly funded startups will do the job. Reinsurance or not.
Citizens will go bust, so will these other no name companies. For the individual, I’d rather have Citizens because they’ll pay and then the companies will assess their insurers (i.e. taxpayers) but at least someone will pay to more or less rebuild my house. If I have one of these other companies, I’m going to be out of luck when they go bust. For people who love the free market so much, they all hate it when it comes to insurance, so they’ve created this mess. If they were true leaders, they’d explain that Floridians aren’t paying what they need to pay for insurance and then let the market find the right rate. We live in a peninsula (I call it the hurricane bowling alley); we should have some of the highest rates in the country.
I am not JUST an agent and I am very familiar with the situation in Florida, with the Cat fund and the barely legal surplus that many of these “Better than Citizens” carriers currently have.
My agency currently has business with dozens of these take out carriers. I would certainly say that we have embraced the concept of depopulation. I agree the regulation is out of control and the commissioner should find another line of work. But you can not seriously think that any politician would allow Citizens to actually fail. They will continue post event funding as they always have in the form of assessments. Citizens will never fail to pay policy limits on covered total losses and they are obviously not subject to the $500k FIGA limit if they were to run out of funds. They would just tack on another assessment.
I think we can both agree that the root of the Citizens problem and the root of the admitted market problem is primarily those that are sitting in Tallahassee making all the policies. Crist, McCarty and many of the politicians that have failed for 4 years to come up with meaningful legislation that will help. There is nothing that will make it all better tommorrow. But a rate freeze on Citizens, come on. If we keep adding assessments there is clearly a problem with the market place.
FINANCIAL SUMMARY of Magnolia
Policyholders’ Surplus $14,227,892
Gross Premiums Written $55,248,782
Net Premium Written $2,687,012
Take a look at the Demotech numbers for these carriers and tell me I should be excited to be insured by them.
It’s all we have left in Florida, but at times I feel like a pimp that only has infected girls and then trying to market them as somehow better than nothing at all.
Our market place is sick.
South Fla Agent, you said you have been forming a company for 2 years? What is the problem getting things going. These other under a rock companies got going a lot quicker than that. Are you going to do take outs at first or just voluntary business, are you going to be a real company with staff or a Virtual carrier that subs out all aspects of doing business? What will your surplus be, how is the investors side coming along, who is your reinsurance carriers going to be. If you have taken 2 years and have actually been actively pursuing this, something is wrong because too many have done it before and the model is out there to follow. And the best question for last. Why would you want to be a homeowners insurance carrier in Florida? with such regulation, competition, rate concerns, expenses and little expectation of profit, why not sell widgets?
I have been working on it for two years because we are forming something unique and good things take time. It will not be a take-out and is a commercial carrier, not homeowners. This is a complex environment to raise capital and get approval from OIR for certain criteria.Not to mention no one knows what will happen with the Cat Fund. I agree that a homeowners company is not the best move right now, especially a take-out.
Let’s just cross our fingers and hope Tallahassee wakes up soon.
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Let me guess, these are all start up companies to take over this business and they have very little financial backing. Wild guess.
Nobody important, do you have any idea the situation Citizens and the state are putting all of us in. The best thing they are doing is approving these take-outs to get exposure out of Citizens. Insureds are 110% better off in these smaller private companies then they are with Citizens. Yes, some of them may have small amounts of capital but with their reinsurance programs and strict regulation, they are well run companies that usually dont overleverage. Citizens is extremely overleveraged and it will be a disaster when the BIG ONE hits.
I understand fully that Citizens is a joke and yet undercapitalized start ups are just as big a joke. If the politicians would stop grandstanding and let the market work, it might be handled. On the other hand, if you build in a wind tunnel, your structure will fall down on a regular basis. The politics in Florida regarding insurance is a joke. I don’t mean that in a funny way.
I would have a hard time saying that my clients were BETTER off with a take out carrier than with Citizens. Citizens will NEVER go bankrupt and never be the reason for a FIGA assessment. these other carriers are not financially sound to take on the exposure that they are and the OIR knows it. follow the money trail…
JR,
I suggest you read and learn more about the reality of the situation with the Cat Fund and what would happen in the event of a major storm. You should be able to recommend a take-out company over Citizens and feel comfortable with it. If you are simply an agent you may not know all of the background details as I do because I have been forming a company for 2 years and understand the setup and background details.
Citizens would be bankrupt after a major storm and would have to collect tax payer money to get them out of it. However, that being said, all of the start ups are in trouble as well due to the Cat Fund problems because there is not enough money there due to bonding issues with the credit crunch and certain layers of the reinsurance offered from the Cat Fund could be non-exsistent. We have major problems in this state that no politician is address because they simply care about popularity by keeping rates low. I truly hope new legislation is passed that helps stop what is setting up to be a disaster.
S Fl Agent, I think you misunderstand. I fully sympathize with you and the problems there. I admire the politicians in a perverse way. They have set Citizens up to fail and yet if they do it looks like the insurance industry at fault rather than the politicians. Who has to try to collect the outrageous assessments that would be required? The companies, which makes us the bad guys. I have said before it is one of the most perfect political dodges I have ever seen. They take the credit and none of the blame. My company has pulled out of property in Florida like most others. I well understand the catastrophe that is going to occur. I wish the people of the state understood. I just don’t think lightly funded startups will do the job. Reinsurance or not.
Citizens will go bust, so will these other no name companies. For the individual, I’d rather have Citizens because they’ll pay and then the companies will assess their insurers (i.e. taxpayers) but at least someone will pay to more or less rebuild my house. If I have one of these other companies, I’m going to be out of luck when they go bust. For people who love the free market so much, they all hate it when it comes to insurance, so they’ve created this mess. If they were true leaders, they’d explain that Floridians aren’t paying what they need to pay for insurance and then let the market find the right rate. We live in a peninsula (I call it the hurricane bowling alley); we should have some of the highest rates in the country.
I am not JUST an agent and I am very familiar with the situation in Florida, with the Cat fund and the barely legal surplus that many of these “Better than Citizens” carriers currently have.
My agency currently has business with dozens of these take out carriers. I would certainly say that we have embraced the concept of depopulation. I agree the regulation is out of control and the commissioner should find another line of work. But you can not seriously think that any politician would allow Citizens to actually fail. They will continue post event funding as they always have in the form of assessments. Citizens will never fail to pay policy limits on covered total losses and they are obviously not subject to the $500k FIGA limit if they were to run out of funds. They would just tack on another assessment.
I think we can both agree that the root of the Citizens problem and the root of the admitted market problem is primarily those that are sitting in Tallahassee making all the policies. Crist, McCarty and many of the politicians that have failed for 4 years to come up with meaningful legislation that will help. There is nothing that will make it all better tommorrow. But a rate freeze on Citizens, come on. If we keep adding assessments there is clearly a problem with the market place.
FINANCIAL SUMMARY of Magnolia
Policyholders’ Surplus $14,227,892
Gross Premiums Written $55,248,782
Net Premium Written $2,687,012
Take a look at the Demotech numbers for these carriers and tell me I should be excited to be insured by them.
It’s all we have left in Florida, but at times I feel like a pimp that only has infected girls and then trying to market them as somehow better than nothing at all.
Our market place is sick.
South Fla Agent, you said you have been forming a company for 2 years? What is the problem getting things going. These other under a rock companies got going a lot quicker than that. Are you going to do take outs at first or just voluntary business, are you going to be a real company with staff or a Virtual carrier that subs out all aspects of doing business? What will your surplus be, how is the investors side coming along, who is your reinsurance carriers going to be. If you have taken 2 years and have actually been actively pursuing this, something is wrong because too many have done it before and the model is out there to follow. And the best question for last. Why would you want to be a homeowners insurance carrier in Florida? with such regulation, competition, rate concerns, expenses and little expectation of profit, why not sell widgets?
CO Man,
I have been working on it for two years because we are forming something unique and good things take time. It will not be a take-out and is a commercial carrier, not homeowners. This is a complex environment to raise capital and get approval from OIR for certain criteria.Not to mention no one knows what will happen with the Cat Fund. I agree that a homeowners company is not the best move right now, especially a take-out.
Let’s just cross our fingers and hope Tallahassee wakes up soon.