Florida's Citizens Property Insurance Shrinks as Private Insurers Gain Customers

Florida's Citizens Property Insurance Corporation experienced a significant reduction in policy count, dropping nearly 200,000 policies in one week to 569,495 as private insurers actively acquired new customers.

This marks the lowest number of policies since 2021, following a peak of 1.4 million policies in September 2023. The decrease is primarily attributed to the state's depopulation program, which transfers policies from Citizens to approved private insurers to reduce the state's financial risk exposure tied to catastrophic storms.

The depopulation program surged with nearly 200,000 policies assumed in a single week by several private insurers, including Slide Insurance Co., Manatee Insurance Exchange, and Homeowners Choice Property & Casualty Insurance Co., among others. The Florida Office of Insurance Regulation has authorized further depopulation rounds scheduled for mid-November and mid-December, signifying ongoing efforts to shrink Citizens’ policy portfolio.

Citizens, initially established as an insurer of last resort, grew to Florida's largest property insurer amid private market challenges. Legislative reforms aiming to limit litigation exposure for insurers have encouraged private companies to re-enter the Florida property insurance market, facilitating this policy migration. The state's objective is to mitigate the financial risk Citizens poses to all Floridians if major hurricanes trigger large-scale claims that surpass Citizens’ reserves.

However, this transition carries some implications for policyholders. Florida law requires that homeowners who receive private insurance offers within 20 percent of Citizens’ premium rates become ineligible to stay with Citizens, potentially leading to increased premiums under private coverage. This regulatory structure incentivizes moving policies to the private market but may impact affordability for some policyholders.

Looking ahead, Citizens projects its policy count will fall to approximately 430,000 by the end of 2025, levels not seen since 2018. This trend underscores evolving market dynamics where regulatory reforms intersect with insurer risk appetite and market capacity, reshaping Florida’s property insurance landscape amid ongoing hurricane exposure concerns.