PROPERTY

INSURANCE
STABILITY
REPORT
July 1, 2024

Michael Yaworsky
Insurance Commissioner
Purpose and Scope ........................................................................................................................ 2
Organization of the Report .......................................................................................................... 3
Insurer Litigation Practices ......................................................................................................... 3
NAIC MCAS Data ...................................................................................................................... 3
Domestic Homeowners Defense Cost & Containment Expenses ............................................... 4
DFS Legal Service of Process ..................................................................................................... 5
DFS Legal Service of Process Cont. ........................................................................................... 6
DFS Notice of Intent to Litigate.................................................................................................. 7
DFS Civil Remedy Notices ......................................................................................................... 8
Property Claims and Litigation Data Call ................................................................................... 9
Homeowners and Condominium Unit Owners Policies in the Voluntary Market ............... 12
Homeowner Policies ................................................................................................................. 12
Condominium Unit Owner Policies .......................................................................................... 13
Profitability.................................................................................................................................. 14
Premiums ..................................................................................................................................... 16
Annual Reinsurance Data Call and Catastrophe Stress Test ................................................. 18
2024 CST................................................................................................................................... 18
2023 CST................................................................................................................................... 18
Reinsurance ................................................................................................................................. 19
Property Insurer Stability Unit Referrals ................................................................................ 20
Insurers Referred for Enhanced Monitoring ............................................................................. 21
Insurers Deemed Appropriate for Enhanced Monitoring ...................................................... 22
Companies Referred for the Initiation of Delinquency Proceedings ..................................... 22
Market Conduct Examination Findings ................................................................................... 23
Recommendations and Trends .................................................................................................. 23

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 Purpose and Scope
On May 26, 2022, Governor Ron DeSantis signed Senate Bill 2-D (SB 2-D) into law, creating
the Insurer Stability Unit. The makeup and requirements of the Insurer Stability Unit were later
amended by Senate Bill 2-A (SB 2-A), which was signed by the Governor on December 16,
2022. The bills made important reforms designed to stabilize Florida’s property insurance
market. Pursuant to section 627.7154, Florida Statutes, the Florida Office of Insurance
Regulation (OIR) shall:
On January 1 and July 1 of each year, provide a report on the status of the homeowners’ and
condominium unit owners’ insurance market to the Governor, the President of the Senate, the
Speaker of the House of Representatives, the Minority Leader of the Senate, the Minority Leader
of the House of Representatives, and the chairs of the legislative committees with jurisdiction
over matters of insurance showing:
1. Litigation practices and outcomes of insurance companies.
2. Percentage of homeowners and condominium unit owners who obtain insurance in
the voluntary market.
3. Percentage of homeowners and condominium unit owners who obtain insurance from
the Citizens Property Insurance Corporation.
4. Profitability of the homeowners’ and condominium unit owners’ lines of insurance in
this state, including a comparison with similar lines of insurance in other hurricane-
prone states and with the national average.
5. Average premiums charged for homeowners’ and condominium unit owners’
insurance in each of the 67 counties in this state.
6. Results of the latest annual catastrophe stress tests of all domestic insurers and
insurers that are commercially domiciled in this state.
7. The availability of reinsurance in the personal lines insurance market.
8. The number of property and casualty insurance carriers referred to the insurer
stability unit for enhanced monitoring, including the reason for the referral.
9. The number of referrals to the insurer stability unit which were deemed appropriate
for enhanced monitoring, including the reason for the monitoring.
10. The name of any insurer against which delinquency proceedings were instituted,
including the grounds for rehabilitation pursuant to s. 631.051 and the date that each
insurer was deemed impaired of capital or surplus, as the terms impairment of capital
and impairment of surplus are defined in s. 631.011, or insolvent, as the term insolvency
is defined in s. 631.011; a concise statement of the circumstances that led to the insurer’s
delinquency; and a summary of the actions taken by the insurer and the office to avoid
delinquency.
11. The name of any insurer that is the subject of a market conduct examination that
found the insurer exhibited a pattern or practice of one or more willful unfair insurance
trade practice violations with regard to its use of appraisal, including, but not limited to,
compelling insureds to participate in appraisal under a property insurance policy in

2
 order to secure full payment or settlement of claims, and a summary of the findings of
such market conduct examination.
12. Recommendations for improvements to the regulation of the homeowners’ and
condominium unit owners’ insurance market and an indication of whether such
improvements require any change to existing laws or rules.
13. Identification of any trends that may warrant attention in the future.

Organization of the Report

The primary data used to construct this report is obtained from the National Association of
Insurance Commissioners (NAIC) InsData financial database, the Quarterly and Supplemental
Reporting System – Next Generation (QUASRng), the Florida Department of Financial
Services (DFS), internal reviews of company data, annual data calls with insurers, the
Catastrophe Stress Tests, the internal OIR system data, and OIR legislative reports. Legislative
changes which may have impacted data points are indicated within the report.
Prior OIR updates are available here.

Insurer Litigation Practices

Litigation practices and outcomes of insurance companies.
One of the primary challenges for Florida’s property market has been the frequency and severity
of litigated claims. In 2019, Florida passed legislation curbing excessive litigation associated
with the use of Assignment of Benefits (AOBs). In 2021, the Florida Legislature passed SB 76
which restructures litigation rules for disputed insurance claims. In 2022, SB 2-D and SB 2-A
provided further litigation reforms by limiting the assignment of attorney’s fees to third parties in
property insurance cases, and disincentivizing frivolous claims. In 2023, the Florida Legislature
passed HB 837, which provides that a contingency fee multiplier for an attorney fee award is
appropriate only in a rare and exceptional circumstance, and repeals Florida’s one-way attorney
fee statutes, with certain exceptions. OIR uses several data points to track insurer litigation
practices in the market. Those data points are listed below.

NAIC MCAS Data

The NAIC Market Conduct Annual Statement (MCAS) is a regulatory tool developed in 2002 by
state insurance regulators to collect information from insurers on a uniform basis to identify
concerns regarding claims and underwriting. Homeowners’ insurance companies report data via
MCAS using uniform definitions and reporting requirements across all states. The MCAS data
below contains the percentage of nationwide homeowners’ claims and suits opened in Florida.
2023 MCAS Data will be available in the third quarter of 2024.

3
 Percent of Nationwide
Percent of Nationwide Homeowners’
Year Homeowners’ Suits Opened in
Claims Opened in Florida
Florida
2016 7.75% 64.43%
2017 16.46% 68.07%
2018 11.85% 79.91%
2019 8.16% 76.45%
2020 8.81% 79.16%
2021 6.91% 76.00%
2022 14.93% 70.83%

Domestic Homeowners Defense Cost & Containment Expenses

OIR tracks defense cost and containment expenses (DCC) through the NAIC annual financial
statement data.
In 2023, insurers paid approximately $3,461,222,000 in direct domestic homeowners’ DCC
expenses. The DCC includes defense, litigation, and medical cost containment expenses, whether
internal or external. It includes attorney fees owe to a duty to defend.

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 DFS Legal Service of Process
Pursuant to section 48.151(3), Florida Statutes (2021), all authorized insurers (insurance
companies) registered to do business in the state of Florida are required to designate the Chief
Financial Officer of Florida as their statutory Registered Agent for service of process.
Using data from the DFS Legal Service of Process database, OIR matched lawsuits against
known property insurers using key terms.
Personal Residential Legal Service of Process (LSOP) filings

The total number of Personal Residential Legal Service of Process filings is identified in blue with the 12-month
average is identified in red, as of May 31, 2024.1

1
Data collected from https://apps.fldfs.com/lsopreports/reports/report.aspx. Data as of June 24, 2024.

5
 DFS Legal Service of Process Cont.
Personal Residential Legal Service of Process filings that contained AOBs

The total number of Personal Residential Legal Service of Process filings that contained AOBs is identified in blue
with the 12-month moving average identified in red, as of May 31, 2024.2

2
Data collected from https://apps.fldfs.com/lsopreports/reports/report.aspx. Data as of June 24, 2024.

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 DFS Notice of Intent to Litigate
Following the passage of SB 76, when a party reaches the point of filing legal actions against an
insurer related to a property insurance policy, they must first submit notice of their intent to
initiate litigation pursuant to the process prescribed in section 627.70152, Florida Statutes. OIR
has closely tracked the number of notices of intent to litigate within the DFS database since it
was implemented in 2021.

SB 2-D provided that a defendant insurer may obtain attorney fees and costs associated with
securing a dismissal without prejudice for the plaintiff’s failure to provide the required Notice of
Intent to Initiate Litigation at least 10 days before filing a suit against a property insurer and
clarifies the requirement to provide a Notice of Intent to Initiate Litigation before filing suit.

HB 837, passed in March 2023, modified Florida’s “bad faith” framework, provided that a
contingency fee multiplier for an attorney fee award is appropriate only in a rare and exceptional
circumstance, essentially adopting the federal standard, and repealed Florida’s one-way attorney
fee statutes, except for declaratory relief to determine insurance coverage after an insurer has
made a total coverage denial of a claim.

Property Insurance Intent to Initiate Litigation filings

The total number of property insurance intent to initiate litigation filings is identified in blue with the 12-month
moving average identified in red, as of May 31, 2024.3

3
Data collected from https://piitil.myfloridacfo.gov/. Data as of June 24, 2024.

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 DFS Civil Remedy Notices
The Civil Remedy Notice is intended for use by parties who are beginning the process of filing
suit against an insurer, when a party feels they have been damaged by specific acts of the insurer.
The Notice is intended to meet a portion of legal requirements set forth in section 624.155,
Florida Statutes, which requires a party to file Notice with the DFS via the online Civil Remedy
filing system at least 60 days prior to bringing an action against the insurer.
Using data from the DFS Civil Remedy Notice database, OIR tracks the number notices filed on
personal residential insurers.
Personal Residential Civil Remedy Notice of Insurer Violations filed

The total number of Personal Residential Civil Remedy Notice of Insurer Violations filed is identified in blue with the 12-
month moving average identified in red, as of May 31, 20244.

4
Data collected from https://apps.fldfs.com/civilremedy/. Data as of June 24, 2024.

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 Property Claims and Litigation Data Call
Pursuant to s. 624.424(11), F.S., each authorized insurer or insurer group issuing personal lines
or commercial lines residential property insurance policies in Florida is required to annually file
a supplemental report on an individual and group basis for closed claims with OIR.
The Florida Property Claims and Litigation Report (PCLR) was designed to assist OIR and other
stakeholders with identifying and understanding the life cycle of a claim and claims trends. The
data reported captures information about closed claims during calendar year 2023.
The 2024 PCLR data call is specific to Florida and tracks the entire life cycle of a claim.
Collecting data related to the life cycle of a claim assists in detecting and resolving any emerging
issues in the claims experience process. The PCLR data call is the first data collection across the
country to require detailed closed claims experience from companies in this format. To ensure
the integrity of the data, OIR identified irregularities and required insurers to resubmit corrected
filings throughout the review process.
OIR issued an Informational Memorandum OIR-22-01M, to all personal and commercial
residential property insurers authorized to provide guidance regarding new reporting
requirements. In January 2024, OIR issued the property claims and litigation data call notice to
each insurer or insurer group required to submit data5. OIR issued a total of $3,000 in penalty
fines to 1 insurer for failing to timely file the required 2023 PCLR data.
The data call was noticed to 629 companies and 187 companies submitted data filings6. OIR
received data for a total of 658,512 unique7 claims closed during calendar year 20238. An
overview of the claims data reported is outlined below9.
• Total number of reported claims closed in 2023: 658,512
o Total number of litigated claims: 64,351
o Total number of non-litigated claims: 541,211
o Non-catastrophe claims reduced (-7.26%) from 2022 to 2023.
• Total cost of indemnity paid for claims closed in 2023: $15.3 billion
• Total loss adjustment expenses (LAE) paid for claims closed in 2023: $1.9 billion
o Average LAE paid across all perils for litigated claims: $10,543

5
OIR developed Form OIR-B1-2222, Florida Property Claims Litigation Data Call Reporting Form, for companies
to use when submitting PCLR data. The reporting template contains five main categories to capture information on
closed claims within the reporting calendar year: Main Claim Information, Vendor Information, Attorney
Information, Public Adjuster Information, and Supplemental Information.
6
OIR issued the PCLR data call to all required insurers authorized to do business in the state. A company can be
authorized to do business, but have no policies in force, and therefore no data to submit. A “no data” filing allows
OIR to track which companies have responded, but do not have data.
7
Unique claim counts do not include duplicate claim IDs.
8
Claims closed in 2023 may not have been originally reported in the same calendar year.

9
Individual claims data is trade secret and confidential pursuant to sections 624.4212 and 624.4213, Florida
Statutes. Note: Many Hurricane Ian claims will be reported in the 2023 closed claims report.

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 o Average LAE paid across all perils for non-litigated claims: $2,011
The life of a claim begins when a claim is reported by policyholder to the insurer. The time it
takes for an insurer to close a claim varies depending on many factors, including whether or not a
claim is litigated. Across all perils, the average number of days for a claim to be reported to an
insurer by the policyholder is 57 days. Across all perils, the average number of days for insurers
to close a claim is 77 days.

Claims Closed During Calendar Year 2023

Peril Closed Claims Litigated Non-Litigated Unknown

Accidental
Discharge; Overflow 89,641 12.55% 76.96% 10.48%
of Water; Steam
All Other Perils 96,111 6.46% 83.38% 10.16%
Falling Object 3,370 7.33% 87.95% 4.72%
Fire or Lightning 13,964 2.54% 82.98% 14.48%
Hurricane 249,294 7.40% 88.33% 4.27%
Other Water 69,797 13.25% 81.25% 5.50%
Sinkhole 277 16.01% 74.02% 9.96%
Windstorm or
Hailstorm (other 136,058 13.42% 71.89% 14.69%
than Hurricane)

Litigated and Non-Litigated Closed Claims Comparison

Percentage of
Policies in Litigated Non-Litigated
Area of the Florida Litigated Claims
Force Claims Claims
within Region
Palm Beach,
Broward and
1,660,339 27,960 75,231 25.94%
Miami-Dade
counties
Seminole, Orange,
Lake and Osceola 769,047 8,602 62,313 10.95%
counties

All Other Counties 5,023,074 27,789 403,667 5.85%

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 Statewide 7,452,460 64,351 541,211 9.73%

Combined View of Indemnity and LAE Paid for Litigated Claims

Avg. Indemnity Avg. LAE

Days to
Peril Litigated Non-Litigated Litigated Non-Litigated
Close
<61 Days $22,084 $8,490 $10,170 $1,055
Accidental 61 – 180
$27,409 $17,803 $11,854 $1,831
Discharge; Days
Overflow of 181 – 365
$38,241 $34,797 $10,702 $2,714
Water; Steam Days
>365 Days $51,335 $48,140 $17,765 $5,932
<61 Days $27,771 $5,813 $5,629 $907
61 – 180
$34,034 $18,016 $6,579 $2,599
All Other Days
Perils 181 – 365
$42,479 $42,068 $9,343 $3,627
Days
>365 Days $58,279 $63,632 $16,038 $9,776
<61 Days $21,738 $3,572 $12,546 $793
61 – 180
$18,964 $13,043 $14,447 $1,945
Days
Falling Object
181 – 365
$28,532 $31,488 $12,474 $2,214
Days
>365 Days $63,826 $33,317 $23,595 $3,180
<61 Days $63,966 $27,619 $18,810 $1,170
61 – 180
$121,368 $86,460 $11,496 $2,996
Fire or Days
Lightning 181 – 365
$131,552 $166,172 $14,149 $5,407
Days
>365 Days $226,604 $265,301 $28,408 $9,811
<61 Days $52,975 $23,291 $10,670 $2,156
61 – 180
$52,017 $34,986 $12,725 $3,127
Days
Hurricane
181 – 365
$66,600 $55,788 $12,892 $4,638
Days
>365 Days $90,376 $114,898 $21,470 $8,514
<61 Days $25,509 $9,173 $8,888 $1,314
61 – 180
$30,387 $20,207 $9,139 $2,713
Days
Other Water
181 – 365
$34,936 $33,607 $7,955 $3,419
Days
>365 Days $45,209 $60,814 $14,515 $5,485

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 <61 Days $76,300 $2,139 $22,615 $2,665
61 – 180
$95,079 $8,713 $28,491 $8,024
Days
Sinkhole
181 – 365
$121,524 $150,818 $19,652 $12,253
Days
>365 Days $101,496 $241,847 $30,924 $31,855
<61 Days $33,953 $14,164 $7,996 $947
Windstorm or 61 – 180
$36,196 $24,604 $9,962 $2,365
Hailstorm Days
(other than 181 – 365
$41,790 $43,878 $9,206 $3,023
Hurricane) Days
>365 Days $52,858 $40,898 $13,825 $7,647

As OIR continues to collect and analyze this data through the annual data call and will utilize it
over time to understand and improve Florida’s insurance markets.
Homeowners and Condominium Unit Owners Policies in the Voluntary Market
Percentage of homeowners and condominium unit owners who obtain insurance in the voluntary
market. Percentage of homeowners and condominium unit owners who obtain insurance from
the Citizens Property Insurance Corporation.
Through OIR’s QUASRng, insurers report the number of homeowners and condominium unit
owner policies issued in the voluntary market, including the number of homeowners and
condominium unit policies from Citizens Property Insurance Corporation (Citizens). For the
purposes of this report, the voluntary market includes all homeowners’ insurers writing
homeowners’ and condominium unit owners policies in Florida, not including Citizens or surplus
lines. Additional information for the surplus lines market is available through the Florida Surplus
Lines Service Office at www.fslso.com.

Homeowner Policies
For Homeowners policies (excluding tenants and condominium), the market share for voluntary
insurers was 83.74 percent and the market share for Citizens was 16.26 percent, as of March 31,
2024.10 These total market share figures represent Homeowners Multi-Peril policies and
Homeowners Wind Only policies combined. The tables below show the market share for each
type of policy.
Homeowners Multi-Peril # Policies – Q1 2024 % Policies – Q1 2024
Voluntary Market 3,504,246 84.84%
Citizens 626,122 16.16%
Total 4,130,368 100%

Homeowners Wind Only # Policies – Q1 2024 % Policies – Q1 2024

Voluntary Market 16,171 21.96%
Citizens 57,475 78.04%
Total 73,646 100%

10
QUASRng data as of March 31, 2024, was submitted to OIR on May 15, 2024.

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 Condominium Unit Owner Policies
For Condominium Unit Owner policies, the market share for voluntary insurers was 90.74
percent and the market share for Citizens was 9.26 percent as of March 31, 2024. These total
market share figures represent Condominium Unit Owners Multi-Peril policies and
Condominium Unit Owners Wind Only policies combined. The tables below show the market
share for each type of policy.
Condominium Unit Owners Multi-Peril # Policies – Q1 2024 % Policies – Q1 2024
Voluntary Market 858,090 92.50%
Citizens 69,541 7.50%
Total 927,631 100%

Condominium Unit Owners Wind Only # Policies – Q1 2024 % Policies – Q1 2024

Voluntary Market 4,660 20.10%
Citizens 18,523 79.90%
Total 23,183 100%

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 Profitability
Profitability of the homeowners’ and condominium unit owners’ lines of insurance in the state,
including a comparison with similar lines of insurance in other hurricane-prone states and with
the national average.
OIR tracks the performance of Florida’s domestic property insurers, including net underwriting
gains, net income, and average combined ratio.

Performance of Florida Domestic Property Companies

The orange bar depicts the domestic industry’s underwriting gain or loss. Underwriting gains or losses represent
how much an insurance company has either made or lost from their operations. The blue bar indicates the domestic
industry’s net income.

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Loss Reserve Development Over Time

The chart depicts loss reserve development for Florida domestic insurers. The blue line shows the one-year loss
reserve development, and the orange line shows the two-year loss reserve development.

Upon the filing of a claim, or an anticipated claim, insurers establish a loss reserve, which is the
amount the insurer believes that claim will ultimately cost. At periodic points in time, an insurer
goes back and evaluates how much those claims actually cost and uses that information to inform
reserves going forward. If claims cost less than projected, reserve redundancies exist. If claims
cost more than projected, reserves are said to have developed adversely.
If an insurers’ claims being paid out are more than what the company has reserved, then the
amount originally determined to be set aside is deficient. If market trends including but not
limited to unexpected catastrophe losses, litigation, or social inflation, result in increased claims
payments of more than what was originally reserved, the actuary may recommend increasing the
company’s reserves for future claims payments.
To quantify, when carriers looked back one year later on their claims in 2023, claims were
approximately $161 million more than estimated after one year, and $399 million at the two-
year mark. These numbers reflect the degree of uncertainty which exists in the property
insurance market, which in turn impacts reinsurance capacity and reinsurance rates for
insurers. The insurance industry is inherently uncertain; for this reason, it is not expected that
the established loss reserve will always exactly equal the ultimate cost of claims. The greater
the uncertainty that exists on future claims, the more reinsurers will tend to hedge their
willingness to offer capacity, and the capacity that is available will cost more as a result.

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The insurance industry is inherently uncertain; for this reason, it is not expected that the
established loss reserve will always exactly equal the ultimate cost of claims. The greater the
uncertainty that exists on future claims, the more reinsurers will tend to hedge their willingness
to offer capacity, and the capacity that is available will cost more as a result.

The National Association of Insurance Commissioners (NAIC) 2022 Profitability Report is

available here which provides a state-by-state comparison of each line of business.
Premiums
Average premiums charged for homeowners’ and condominium unit owners’ insurance in each
of the 67 counties in this state.
Through QUASRng, OIR collects information on policies in force by county and the total
amount of premium collected. To determine the average premium by county for this report, OIR
calculated the total premium divided by the policies in force with wind coverage by county.
Actual charged premium will vary based upon company, insured value, deductibles, and the
policy terms.
The average premiums charged for homeowners’ and condominium unit owners’ insurance is
listed in the following chart. The following information represents data reported in QUASRng as
of March 31, 2024. Cells labeled “N/A” indicate no policies in force.

Average Premiums Charged for Homeowners and Condominium Unit Owners

County Homeowners Condominium Unit Owners

Alachua $2,357 $1,017
Baker $2,203 N/A
Bay $3,243 $1,406
Bradford $2,522 $942
Brevard $3,321 $1,432
Broward $6,058 $1,960
Calhoun $3,005 $2,089
Charlotte $3,062 $1,350
Citrus $2,372 $1,115
Clay $2,361 $921
Collier $5,315 $2,211
Columbia $2,440 $1,026
Desoto $3,243 $1,037
Dixie $2,825 $1,094
Duval $2,582 $1,044
Escambia $3,508 $1,774
Flagler $2,458 $1,325
Franklin $5,103 $1,573
Gadsden $2,574 $1,414
Gilchrist $2,398 $1,884
Glades $3,278 $1,095

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 Gulf $3,736 $1,573
Hamilton $2,679 N/A
Hardee $3,248 $1,037
Hendry $2,999 $1,413
Hernando $2,246 $1,083
Highlands $2,533 $1,063
Hillsborough $3,203 $1,305
Holmes $2,831 N/A
Indian River $4,272 $2,013
Jackson $2,681 N/A
Jefferson $2,607 N/A
Lafayette $3,083 N/A
Lake $2,345 $1,069
Lee $3,514 $1,437
Leon $2,361 $848
Levy $2,700 $1,601
Liberty $2,823 N/A
Madison $2,722 N/A
Manatee $2,998 $1,362
Marion $2,136 $1,055
Martin $5,831 $1,756
Miami-Dade $6,021 $2,987
Monroe $8,487 $4,300
Nassau $2,809 $1,797
Okaloosa $3,608 $1,695
Okeechobee $3,508 $1,462
Orange $3,196 $1,207
Osceola $2,594 $1,189
Palm Beach $6,379 $2,412
Pasco $2,594 $983
Pinellas $3,687 $1,357
Polk $2,588 $1,110
Putnam $2,455 $990
Santa Rosa $3,307 $1,798
Sarasota $3,442 $1,783
Seminole $3,118 $1,147
St. Johns $2,738 $1,330
St. Lucie $3,327 $1,538
Sumter $1,965 $1,054
Suwannee $2,754 $621
Taylor $2,621 $1,128
Union $2,592 N/A
Volusia $2,693 $1,182
Wakulla $2,288 $1,191
Walton $5,035 $1,934
Washington $2,911 N/A

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 Annual Reinsurance Data Call and Catastrophe Stress Test
Results of the latest annual catastrophe stress tests of all domestic insurers and insurers that are
commercially domiciled in this state.
OIR conducts the Annual Reinsurance Data Call (ARDC) and Catastrophe Stress Test (CST)
pursuant to section 624.316, Florida Statutes, to evaluate the reinsurance programs that
companies have in place to respond to catastrophic events that may occur during the Atlantic
hurricane season. OIR requires domestic property insurers, commercially domiciled insurers, and
other selected companies to model their losses for the CST assuming a historical event or series
of events occur. Through the CST, insurers are required to model a historical storm scenario, or a
series of historical storm scenarios, and apply their purchased reinsurance program to the
associated modeled loss.
The results of the CST are used by OIR to estimate the insurer’s surplus amounts after the
simulated event and assist in determining if each insurer would continue to meet its minimum
surplus requirement after each storm scenario.

2024 CST
For the 2024 Hurricane Season, the CST was required to be submitted by domestic property
insurers, commercially domiciled insurers, and other selected companies. The 2024 CST storm
scenarios were:
• Scenario 1 – 1945 Homestead Hurricane, followed by 2004 Hurricane Charley, followed
by 2004 Hurricane Frances
• Scenario 2 – 1921 Tampa Bay Hurricane, followed by 2017 Hurricane Irma, followed by
2018 Hurricane Michael
• Scenario 3 – 1928 Lake Okeechobee Hurricane, followed by 2005 Hurricane Wilma,
followed by 2016 Hurricane Hermine
As of June 27, 2024, 89 percent of insurers have filed the ARDC and 89 percent of insurers have
filed the CST. The results from the 2024 CST will be published in the January 1, 2025 report.
2023 CST
For the 2023 Hurricane Season, the CST was required to be submitted by domestic property
insurers, commercially domiciled insurers, and other selected companies. The 2023 CST storm
scenarios were:
• Scenario 1 – 1947 Fort Lauderdale Hurricane
• Scenario 2 – 2004 Hurricane Frances, followed by 2017 Hurricane Irma
• Scenario 3 – 1992 Hurricane Andrew, followed by 2018 Hurricane Michael
Based on the results of the CST scenarios, three insurers were projected to fall below the
minimum surplus requirement. One insurer’s parent company committed to infusing more capital
should the insurer’s surplus fall below the minimum requirement following an event. One
insurer was subsequently merged with and into an affiliate at year-end 2023. The third insurer’s

18
2023 reinsurance program was not significantly impacted by the 2023 hurricane season, and the
insurer has since entered runoff and will not have any policies in force for the 2024 hurricane
season.
Scenario 1: 1947 Fort Lauderdale Hurricane
Based on modeling information provided by insurers, the Fort Lauderdale Hurricane (1947)
would have caused approximately $22.0 billion in insured losses during the 2023 Atlantic
Hurricane Season. After recognizing the impact of reinsurance, net losses to insurers are
projected to be reduced to approximately $5.6 billion.

Scenario 2: Hurricane Frances (2004) and Hurricane Irma (2017)

Based on modeling information provided by insurers, Hurricane Frances (2004) and Hurricane
Irma (2017) would have caused approximately $17.8 billion in insured losses during the 2023
Atlantic Hurricane Season. After recognizing the impact of reinsurance, net losses to insurers are
projected to be reduced to approximately $6.4 billion.

Scenario 3: Hurricane Andrew (1992) and Hurricane Michael (2018)

Based on modeling information provided by insurers, Hurricane Andrew (1992) and Hurricane
Michael (2018) would have caused approximately $29.5 billion in insured losses during the 2023
Atlantic Hurricane Season. After recognizing the impact of reinsurance, net losses to insurers are
projected to be reduced to approximately $7.3 billion.

Reinsurance
The availability of reinsurance in the personal lines insurance market.
Florida is the most catastrophe-prone region in the United States with 8,436 miles of shoreline.
To spread that catastrophic risk outside of Florida’s borders, insurers turn to the global
reinsurance market. Florida’s domestic property insurance industry is especially reliant on
reinsurance to finance the payment of catastrophe losses and is sensitive to hardening
reinsurance market conditions. When the supply of reinsurance is readily available and
affordable, the capacity of domestic property insurers to write and retain business is enhanced,
and the premium impact to consumers is modest.
OIR conducts the ARDC to assess insurers’ financial viability in covering catastrophic losses
with respect to their catastrophic reinsurance programs. The ARDC consists of four stages:
• Stage 1 – Collect estimate of what insurers plan to purchase for reinsurance.
• Stage 2 – Collect the actual amount of reinsurance purchased by insurers.
• Stage 3 – Collect information on the reinsurers utilized.
• Stage 4 – Collect data on the impact of insurers’ reinsurance contracts.
Based on findings from the ARDC for the 2023-2024 year, the amount of 2023 reinsurance
coverage purchased by insurers increased an average of 11 percent from 2022. However, the risk
adjusted cost of that reinsurance increased by 27 percent from 2022 figures.
The results from the 2024 ARDC will be finalized August 2024; however, preliminary data
suggests price stabilization with anticipated flat or decreased risk adjusted costs from 2023, on
average.

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The Florida Hurricane Catastrophe Fund (FHCF) was created in November 1993 during a special
legislative session after Hurricane Andrew. The purpose of the FHCF is to protect and advance
the state's interest in maintaining insurance capacity in Florida by providing reimbursements to
insurers for a portion of their catastrophic hurricane losses.
Property Insurer Stability Unit Referrals
The number of property and casualty insurance carriers referred to the insurer stability unit for
enhanced monitoring, including the reason for the referral. The number of referrals to the
insurer stability unit which were deemed appropriate for enhanced monitoring, including the
reason for the monitoring.
In 2022, in accordance with section 627.7154, Florida Statutes, the property insurer stability unit
(stability unit) was created within the OIR to aid in the detection and prevention of insurer
insolvencies in the homeowners’ and condominium unit owners’ insurance market. The stability
unit, a collaboration among multiple business units throughout the Office, provides enhanced
monitoring whenever OIR identifies significant concerns about an insurer’s solvency, rates,
proposed contracts, underwriting rules, market practices, claims handling, consumer complaints,
litigation practices and outcomes, and any other issue related to compliance with the insurance
code.
In accordance with section 627.7154(4), Florida Statutes, any of the following events trigger a
referral to the stability unit:
• Consumer complaints related to homeowners’ insurance or condominium unit owners’
insurance under s. 624.307(10), F.S., if the complaints, in the aggregate, suggest a trend
within the marketplace and are not an isolated incident.
• There is reason to believe that an insurer who is authorized to sell homeowners’ or
condominium unit owners’ insurance in this state has engaged in an unfair trade practice
under part IX of Chapter 626.
• A market conduct examination determines that an insurer has exhibited a pattern or
practice of willful violations of an unfair insurance trade practice related to claims-
handling which caused harm to policyholders, as prohibited by s. 626.9541(1)(i), F.S.
• An insurer authorized to sell homeowners’ or condominium unit owners’ insurance in
this state requests a rate increase that exceeds 15 percent, in accordance with s.
627.0629(6), F.S.
• An insurer authorized to sell homeowners’ or condominium unit owners’ insurance in
this state violates the ratio of actual or projected annual written premiums required by s.
624.4095(4)(a), F.S.
• An insurer authorized to sell homeowners’ or condominium unit owners’ insurance in
this state files a notice pursuant to s. 624.4305, F.S., advising the Office that it intends to
nonrenew more than 10,000 residential property insurance policies in this state within a
12-month period.
• A quarterly or annual financial statement required by ss. 624.424 and 627.915, F.S.
demonstrates that an insurer authorized to sell homeowners’ or condominium unit
owners’ insurance in this state is in an unsound condition, as defined in s. 624.80(2), F.S.;

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 has exceeded its powers in a manner as described in s. 624.80(3), F.S.; is impaired, as
defined in s. 631.011(12) or (13), F.S.; or is insolvent, as defined in s. 631.011, F.S.
• An insurer authorized to sell homeowners’ or condominium unit owners’ insurance in
this state files a quarterly or annual financial statement required by ss. 624.424 and
627.915, F.S., which is misleading or contains material errors.
• An insurer authorized to sell homeowners’ or condominium unit owners’ insurance in
this state fails to timely file a quarterly or annual financial statement required by ss.
624.424 and 627.915, F.S.
• An insurer authorized to sell homeowners’ or condominium unit owners’ insurance in
this state files a risk-based capital report that triggers a company action level event,
regulatory action level event, authorized control level event, or mandatory control level
event, as those terms are defined in s. 624.4085, F.S.
• An insurer selling homeowners’ or condominium unit owners’ insurance in this state that
is subject to the own-risk solvency assessment requirement of s. 628.8015, F.S., and fails
to timely file the own-risk solvency assessment.
• A reinsurance agreement creates a substantial risk of insolvency for an insurer authorized
to sell homeowners’ or condominium unit owners’ insurance in this state, pursuant to s.
624.610(13), F.S.
• An insurer authorized to sell homeowners’ or condominium unit owners’ insurance in
this state is party to a reinsurance agreement that does not create a meaningful transfer of
risk of loss to the reinsurer, pursuant to s. 624.610(14), F.S.
• Citizens Property Insurance Corporation is required to absorb policies from an insurer
that participated in the corporation’s depopulation program authorized by s. 627.3511,
F.S., within 3 years after the insurer takes policies out of the corporation.
The stability unit’s supervisors review all referrals triggered by the statutory provisions to
determine whether enhanced scrutiny of the insurer is appropriate.

Insurers Referred for Enhanced Monitoring

OIR closely monitors the financial condition and operating results of insurers. Many, if not all, of
the articulated reasons for referral to the stability unit were already causes for OIR to initiate
enhanced monitoring of an insurer.
OIR continues to review insurers previously subject to enhanced monitoring and make
appropriate referrals to the stability unit for any insurer which triggers one of the listed events in
section 627.7154(4), Florida Statutes. As a result, there were 19 insurers referred to the stability
unit for enhanced monitoring from January 1, 2024, through June 21, 2024.
The reasons for the referrals appear in the list below:

• 22 referrals for violating the ratio of actual or projected annual written premiums
(s. 627.7154(4)(e), F.S.);
• 1 referral for filing a notice with OIR that it intends to nonrenew more than
10,000 residential property insurance policies in this state within a 12-month
period (s. 627.7154(4)(f), F.S.);
• 1 referral for filing a quarterly or annual financial statement required by

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 ss. 624.424 and 627.915 which is misleading or contains material errors (s.
627.7154(4)(h), F.S.);
• 4 referrals for failure to timely file a quarterly or annual financial statement (s.
627.7154(4)(i), F.S.);

The number of referrals exceeds the number of insurers referred because some insurers were
referred multiple times for the same or different reasons. Some referrals were for companies
already subject to enhanced monitoring via the stability unit.
Regarding referrals for violating the ratio of actual or projected annual written premiums
pursuant to s. 627.7154(4)(e), F.S., s. 624.4095, F.S., states that if a company exceeds the writing
ratios in that section, “the office shall suspend the insurer’s certificate of authority or establish by
order maximum gross or net annual premiums to be written by the insurer consistent with
maintaining the ratios specified herein unless the insurer demonstrates to the office’s satisfaction
that exceeding the ratios of this section does not endanger the financial condition of the insurer
or endanger the interests of the insurer’s policyholders.”
It should be noted that many of the referrals were either for exceeding the actual or projected
gross writing ratio limitation or for exceeding the projected net writing ratio limitation. When a
company exceeds the actual or projected gross writing ratio limitation, the Office reviews
mitigating factors such as intercompany pooling arrangements and other reinsurance utilized by
the company. When a company exceeds the actual or projected net writing ratio limitation, the
Office reviews the company’s actual net writing ratio and considers other mitigating factors.
Insurers Deemed Appropriate for Enhanced Monitoring
Of the 19 insurers referred to the stability unit from January 1, 2024, through June 21, 2024, two
were deemed appropriate for enhanced monitoring.
The reasons for the referrals for companies deemed appropriate for enhanced monitoring appear
in the list below:
• 2 referrals for violating the ratio of actual or projected annual written premiums (s.
627.7154(4)(e), F.S.)
In total, 20 companies are subject to enhanced monitoring as of the date of this report.
Companies Referred for the Initiation of Delinquency Proceedings
The name of any insurer against which delinquency proceedings were instituted, including the
grounds for rehabilitation pursuant to s. 631.051 and the date that each insurer was deemed
impaired of capital or surplus, as the terms impairment of capital and impairment of surplus are
defined in s. 631.011, or insolvent, as the term insolvency is defined in s. 631.011; a concise
statement of the circumstances that led to the insurer’s delinquency; and a summary of the
actions taken by the insurer and the office to avoid delinquency.
OIR closely and consistently monitors the financial condition and operational results of insurers
doing business in Florida, including domestic property insurers. When a company is referred for
delinquency proceedings, OIR and the Florida Department of Financial Services (DFS) work

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closely with companies to ensure consumer coverage is maintained through the transition of
policies to another insurer.
Since January 1, 2024, no property and casualty insurers were referred to DFS for the purpose of
initiating delinquency proceedings.
Market Conduct Examination Findings
The name of any insurer that is the subject of a market conduct examination that found the
insurer exhibited a pattern or practice of one or more willful unfair insurance trade practice
violations with regard to its use of appraisal, including, but not limited to, compelling insureds
to participate in appraisal under a property insurance policy in order to secure full payment or
settlement of claims, and a summary of the findings of such market conduct examination.
The provisions of this section were added as a result of SB 2-A, effective December 16, 2022. As
of the date of this report, no insurers have been the subject of a market conduct examination that
resulted in a finding as described above.
Following the passage of historic legislative reform, OIR has greater ability to enforce regulatory
authority and has taken actions to increase market regulation compliance, including initiating
more than 50 market conduct investigations following Hurricane Ian to evaluate aspects of the
claims handling process. OIR publishes a quarterly Insurer Compliance Report to provide
updates on OIR’s market regulation efforts, the report is available here.

Recommendations and Trends

Recommendations for improvements to the regulation of the homeowners’ and condominium unit
owners’ insurance market and an indication of whether such improvements require any change
to existing laws or rules and the identification of any trends that may warrant attention in the
future.
In February 2021, at the request of the Florida House Commerce Committee, OIR compiled a
report identifying primary cost drivers for property insurance rates in Florida, trends in the
property market and legislative recommendations. The Florida House Commerce Committee
report is available here. The Florida House Commerce Committee report supplemental letter is
available here.
Under the leadership of Governor Ron DeSantis, the Florida Cabinet, and the Florida
Legislature, many of these legislative recommendations were implemented through SB 76
(2019), SB 2-D (2022), SB 2-A (2022), HB 837 (2023), SB 7052 (2023), and HB 1611 (2024).
OIR continues to see overall market stabilization following the historic legislative reforms of
2022 and 2023 that enhanced protections for consumers, strengthened Citizens Property
Insurance Corporation, and encouraged investment by insurers and reinsurers by providing
clarity to the market and the risk they underwrite.
Rate filings for 2024 show a slight trend downward for the first time in years, indicating
stabilization of the property insurance market. Ten companies have filed a zero percent increase
and nine companies have filed a rate decrease to take effect in 2024.

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The 2023 reinsurance market responded positively to these reforms. Early signs from the 2024
reinsurance purchasing season show further positive indications. Reinsurance is a direct and
significant cost to consumers and relief in this area is a significant sign that the reforms are
working.
After years of consecutive underwriting losses, insurers saw overall stability with many
companies reporting a net profit in 2023. As of Q1 2024, Florida domestic insurers reported
positive net underwriting and positive net income. Since the reforms, eight new companies have
been approved to write homeowners policies in Florida and an additional company was acquired
to expand its footprint in the state. Insurers continue to take policies out of Citizens, and
approximately 389,000 policies have been taken out of Citizens from January 2023 to March
2024.
While OIR is optimistic about the impact of these reforms and the positive developments in
the market, the market must continue to organically recover, without fear of any major
legislative or regulatory disruptions, in order to maximize the benefits of the reforms to
Florida’s policyholders. OIR will continue to monitor trends and impacts from SB 76, SB
2D, SB 2A, HB 837, and SB 7052 and propose additional recommendations for future
Property Insurance Stability Unit reports.
OIR will continue to expand and promote transparency for consumers while also maintaining a
competitive marketplace where insurers are interested in and able to confidently grow. OIR
conducts market research across all lines of business and continues to expand its relationships
with universities throughout the state to explore innovative ways to improve market outcomes
and inform policy decisions.
OIR will continue to build upon its regulatory leading data collection and analysis efforts. HB
1611 (2024) expanded the market data collected by OIR to provide more regular and granular
market data to the office. As illustrated in this report, Florida’s property market is a reflection of
multiple data points in order to provide more complete context on the consumer experience.
Starting 2024, OIR will also begin collecting policy level data to reflect fortification and home
hardening efforts within the market.

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www.FLOIR.com
J. Edwin Larson Building
200 E. Gaines Street
Tallahassee, Florida 32399
Phone: (850) 413-3140

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