Large property insurer to cut back in Florida following hurricane losses
Large property insurer to cut back in Florida following hurricane losses
By Kathy Bushouse
South Florida Sun-Sentinel
March 8, 2006
South Florida Sun-Sentinel
March 8, 2006
Striking a blow to condominium associations and owners statewide, Poe Financial Group of Tampa has told its agents that its Southern Family Insurance Co. subsidiary would no longer issue new policies or renew them for existing customers.
Two other Poe subsidiaries, Atlantic Preferred Insurance Co. and Florida Preferred Insurance Co., will no longer issue new home or condo policies in Florida but will renew policies of existing customers.
Poe Financial, one of Florida's largest property insurers, took a $2 billion hit from the 2004 and 2005 hurricane seasons and needs to attract more investor money to be able to take on new customers, said David Gough, a Poe senior vice president.
The company did have reinsurance to help pay storm damage claims in both 2004 and 2005, but "it's just a matter of volume [of claims] and the premium that you have to cover the volume of claims," Gough said.
Southern Family is the third-largest insurer of condo associations in the state, and among the 10 largest condo unit insurers in South Florida. Atlantic Preferred and Florida Preferred rank fourth and fifth, respectively, among home insurers in Florida.
The company's actions will not affect its ability to pay existing or future property damage claims, Gough said.
Gough said Poe Financial would like to get back to selling new policies should it raise enough capital, but "for the time being we need to do what we're doing." He would not say exactly how much money the company needed to raise, only that it was "in the millions."
For condo associations in South Florida, finding new insurance coverage could be a challenge. "I don't think anybody is going to step in and begin to fill the void at prices anything near where Southern Family has been providing coverage," said Lee Burke, president of Burke, Bogart and Brownell, a Boca Raton insurance agency. ". These folks, they're going to feel the serious impact of premium increases. They're going to see premiums doubling, tripling, quadrupling."
And few companies are willing to issue condo association policies that Southern Family once handled, particularly because Southern Family would insure older buildings that other companies wouldn't touch, said Anita Byer, president of Setnor Byer Insurance and Risk, a Plantation insurance agency.
That will likely mean even more policies going into Citizens Property Insurance Corp., the state's insurer of last resort. The company already is the largest insurer of condo associations in the state and Florida's No. 2 insurer overall.
"They're all going to go into Citizens," Byer said. ". [Other companies] won't do it at Citizens' price, and the companies are being very, very picky."
Two other Poe subsidiaries, Atlantic Preferred Insurance Co. and Florida Preferred Insurance Co., will no longer issue new home or condo policies in Florida but will renew policies of existing customers.
Poe Financial, one of Florida's largest property insurers, took a $2 billion hit from the 2004 and 2005 hurricane seasons and needs to attract more investor money to be able to take on new customers, said David Gough, a Poe senior vice president.
The company did have reinsurance to help pay storm damage claims in both 2004 and 2005, but "it's just a matter of volume [of claims] and the premium that you have to cover the volume of claims," Gough said.
Southern Family is the third-largest insurer of condo associations in the state, and among the 10 largest condo unit insurers in South Florida. Atlantic Preferred and Florida Preferred rank fourth and fifth, respectively, among home insurers in Florida.
The company's actions will not affect its ability to pay existing or future property damage claims, Gough said.
Gough said Poe Financial would like to get back to selling new policies should it raise enough capital, but "for the time being we need to do what we're doing." He would not say exactly how much money the company needed to raise, only that it was "in the millions."
For condo associations in South Florida, finding new insurance coverage could be a challenge. "I don't think anybody is going to step in and begin to fill the void at prices anything near where Southern Family has been providing coverage," said Lee Burke, president of Burke, Bogart and Brownell, a Boca Raton insurance agency. ". These folks, they're going to feel the serious impact of premium increases. They're going to see premiums doubling, tripling, quadrupling."
And few companies are willing to issue condo association policies that Southern Family once handled, particularly because Southern Family would insure older buildings that other companies wouldn't touch, said Anita Byer, president of Setnor Byer Insurance and Risk, a Plantation insurance agency.
That will likely mean even more policies going into Citizens Property Insurance Corp., the state's insurer of last resort. The company already is the largest insurer of condo associations in the state and Florida's No. 2 insurer overall.
"They're all going to go into Citizens," Byer said. ". [Other companies] won't do it at Citizens' price, and the companies are being very, very picky."
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