Citizens Property Insurance is experiencing a tumultuous year, and the pressures aren’t ending soon. The insurer has received nearly 458,000 claims, valuing over $5.3 billion, for hurricanes Debby, Helene, and Milton.
But thousands of those are closing without payment, including three-quarters of the 3,000 claims filed after Hurricane Debby, NOTUS found. Additionally, the Florida Phoenix found that 69% of the 14,000 claims filed after Helene and 44% of the 54,500 Hurricane Milton claims received no payment.
Why Citizens is denying claims
Although Citizens doesn’t track the reasons for its claim denials, Jay Adams, Citizens’ chief insurance officer, offered some explanations to the Florida Phoenix.
Citizens may deny claims for flooding, for high deductibles, or if policyholders file a claim with Citizens after another insurer takes over their policy. Most standard homeowners insurance companies, including Citizens, don’t cover flooding.
But Citizens denying claims isn’t new.
Analytics company Weiss Ratings found that, in 2023, Citizens denied more than 50.4% of claims. In fact, over the past five years, Citizens’ claim denial rate ranged from 40.2% to 50.5%.
“I think that’s probably very factual,” Adams told the Florida Phoenix in response to Weiss Ratings’ report. “Yes, why would that be? Well, Citizens is the insurer of the last resort. We are writing the most risky policies in the state.”
What’s next: Citizen’s future in Florida insurance
Citizens’ premiums aren’t falling anytime soon.
The insurer’s average policy costs $22,165 per year, according to Insurify data. The insurer also offers high deductibles, up to 10% for hurricane coverage. And, like many other home insurers, it doesn’t cover flood damage. This leaves homeowners to secure additional coverage themselves.
And rates appear to be climbing higher. The insurer’s board unanimously voted in favor of a14% rate increase, effective Jan. 1, 2025. It’s still pending approval from Florida’s Office of Insurance Regulation (OIR).
“Floridians have been faithfully paying insurance premiums for years, sometimes decades, and now they expect their insurance company to keep up its end of the bargain,” said Florida Senate President Ben Albritton in his first address. “I want to make sure that impacted Floridians and insurance companies hear me loudly and clearly — we are watching.”
“We’ve made changes that insurance companies said they needed to improve competition and stabilize rates,” he said. “I’m not going to sit idly by if legitimate claims get denied while rates continue to rise.”
The Florida OIR has issued a subpoena to Martin Weiss, owner of Weiss Ratings, demanding proof that backs up his report regarding Citizens’ claims handling.
“Our Office takes our regulatory authority to protect consumers very seriously,” the OIR told WPTV 5. “Weiss’ agency claims to be independent and thorough, and if they really want to warn consumers about their dire claims, they should have no problem answering this subpoena.”
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