17 down grades in FL Next week!

[shawnmwalker]

As a good Citizen of Insforums. I wanted to provide something of value today... So, FL Looks like next week your state is going to go through some dramatic changes!

Florida Regulators, FAIA Slam Demotech for Reported Plans to Downgrade 17 Carriers

Others in the industry have warned for months that many insurers are in trouble, especially after reinsurance prices rose by as much as 50% for some companies. Four carriers have been deemed insolvent so far this year and 12 have stopped writing new business.
“Everyone knew this was coming,” one industry source said Thursday.
The Office of Insurance Regulation, in fact, this week released a market stability report that indicated that 27 insurers – more than half of the active carriers in Florida – have been placed on a watch list.

 

[marindependent]

Thanks for the share @shawnmwalker ! Great article for sure.

I like these parts:

"If Fannie Mae and Freddie Mac “de-authorize a sizeable percentage of Florida’s insurers based on the dubious ratings of one company, it would create financial chaos for millions of Floridians,” Patronis wrote."...

"Petrelli had suggested in May that several carriers could be downgraded this year, thanks in part to the continued costs of fraudulent roof claims and excessive claims litigation. He also sent open letters to Florida’s governor and others, noting that legislation approved in May had not gone far enough...

Others in the industry have warned for months that many insurers are in trouble, especially after reinsurance prices rose by as much as 50% for some companies. Four carriers have been deemed insolvent so far this year and 12 have stopped writing new business.“Everyone knew this was coming,” one industry source said Thursday."
...
And here is the real kicker: "The Office of Insurance Regulation, in fact, this week released a market stability report that indicated that 27 insurers – more than half of the active carriers in Florida – have been placed on a watch list."

But hey - I still want to start a new personal lines 'scratch' agency in Florida anyways.

 

[Heretohelpsome1]

I can't help but to draw a parallel between this and the ratings agencies that contributed to the 2008 recession.

 

[Life Hawk]

I can't help but to draw a parallel between this and the ratings agencies that contributed to the 2008 recession.

Uh... you men the 2022 recession?

Wait...wait... sorry, I stand corrected. Everything is great and we are doing better than we ever have. Reconfirmed and reassured by white house spokes folks.

 

[ehall2]

I am in Georgia but have a non resident license for Florida so I try to keep up with what happens in Florida. They have a real problem and it will never get any better until the legislature makes some changes. I read about a case last week where the claim amount was $55,000 but there were attorney fees of $500,000. This is insane and should not be allowed. I was going through Port St Joe, Florida a few years ago and there was a huge billboard advertising Auto Owners. I couldn't believe they would even consider coverage in Florida. The next week I called a contact I had in the Georgia Insurance Commissioner's office and he told me there were several companies, including State Farm that were writing in Florida. I asked my contact how were these companies doing business when other companies were withdrawing from Florida. He said, they set up a separate company in Florida and if they get hit with a major storm and can't pay they will file bankruptcy. I though he was joking but he said he was serious.

 

[marindependent]

I asked my contact how were these companies doing business when other companies were withdrawing from Florida. He said, they set up a separate company in Florida and if they get hit with a major storm and can't pay they will file bankruptcy.

Yes Sir. Except typically its not bankrupcy - rather receivership.

I actually think these insurers do this more than we all think.

 

[ModernInsurance]

Florida is in deep doo doo.