Blog: Insurance of last resort is first choice for coastal properties – especially in Florida
Jul 11, 2011
The following article was published in the Florida Times-Union on July 11, 2011:
Insurance of Last Resort is First Choice for Coastal Properties — Especially in Florida
A record number of home and commercial property owners — at 3 million, half of which are in Florida — were insured by state-run property insurers at the end of 2010, according to a national report released Monday.
Nearly 1.5 million such policies were underwritten by Florida Citizens Property Insurance Corp., the largest insurer in Florida since 2006, according to the Insurance Information Institute’s “Residual Market Property Plans: From Markets of Last Resort to Markets of First Choice.”
As of May 31, FCPIC policies had dropped to 1.4 million, equal to the 2008 number, but up from 1.2 million in 2009, the report noted. When FCPIC was introduced in 2002, it insured 658,085.
The state-backed policies covered in the report are referred to as the “residual market” for insurance, because property owners typically opt for such policies when they are unable to get conventional property insurance. Residual property market plans have migrated away from their original mission of insuring urban properties to providing insurance in high-risk coastal areas, the report said.
The 2.841 million residual market policies in effect last year was up slightly from the previous record of 2.840 million, set in 2007.