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The report cards are in, revealing that some Florida insurance companies aren’t quite making the grade.
How did your insurance company do, and what does it mean for you?
A.M. Best and Demotech are two companies that do the grading. Although Florida has about 30 insurance companies, NBC2 examined several of the larger companies writing policies in Southwest Florida.
Loggerhead, which assumed many of the Bankers Insurance policies, was given an A by Demotech. They are not A.M. Best rated.
Tower Hill was removed by A.M. but was given an A by Demotech.
Citizens Insurance isn’t rated because it’s a state-run operation, although it lost the most money last year.
The A.M. Best rated companies were however given an N, rated for negative.
Bill Fisher of Cape Coral has a homeowners policy through Tower Hill, which he said finally paid up on his claims sustained during Hurricane Ian.
“It took a long time and a lot of phone calls and frustration,” Fisher explained.
While A&M Best removed his company, he agreed with their A rating from Demotech, which rates Florida insurers.
“We did get our new policy, and it did go up,” Fisher said. “It’s pretty close to $100 a month. That’s the new norm.”
That’s because Florida insurance companies lost a combined $4.2 million last year. Over half of that came from Citizens Insurance, which lost $2.4 million.
Reid McDaniel with McDaniel Insurance Solutions in North Fort Myers said Ian did not significantly impact the 2022 scores. However, he said not all of the data is in since Ian occurred at the end of 2022.
McDaniel warned that companies with lower grades could mean higher rates for policyholders.
“If the company has struggled and maybe they’re downgraded or have a high number of losses, it could mean a rate increase on reinsurance,” McDaniel explained.
Reinsurance is insurance for the insurance companies; those rates will be announced in June, and companies typically have no choice but to pay for those higher rates by passing them on to consumers.
“The big three to look out for are Allstate, Castle Key, as we know they stopped writing new business. They had a substantial rate increase this year,” McDaniel noted.
United Property & Casualty, or UPC, St. John’s Insurance and Southern Fidelity Insurance Co. all received Fs and went out of business.
So who is the A student in this class? McDaniel points to AAA among those writing policies in Florida. A&M Best gives the company an A-. The company is currently only writing new policies on homes that are 1995 and newer. Dozens of other companies received A- but don’t write policies in Florida.
Copyright © 2023 Waterman Broadcasting of Florida, LLC
Copyright © 2023 Waterman Broadcasting of Florida, LLC
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