CurrentFlorida Office of Insurance RegulationPolicy N/A

Consent Order approving FPIC assumption of Citizens policies

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This Consent Order governs conditions under which Florida Peninsula Insurance Company (FPIC) may assume selected personal residential multi-peril policies from Citizens, including limits, required disclosures, reinsurance and compliance obligations, and remedies for noncompliance.

Policy Summary

PayerFlorida Office of Insurance Regulation

PolicyConsent Order approving FPIC assumption of Citizens policies

Policy CodePolicy N/A

Change TypeNo material changes

Effective DateOct 31, 2023

Last ReviewDec 2, 2023

Next Review DateN/A

Key ActionFPIC shall not make takeout offers more than 40% higher than the policyholder's estimated renewal premium and must use Office-approved or use-and-file rates.

SourceLink

POLICY UPDATE CHANGES

No material clinical or coverage changes in this revision.

up to 30,000policies approved for assumption

Jan 23, 2024anticipated assumption date

40%max takeout increase

3 yearscommitment duration

60 dayscure period

Assumption Conditions

Assumption conditions and compliance requirements

Conditions FPIC must satisfy to assume and maintain assumed Citizens policies:

FPIC must adhere to the terms of the Plan and Section 627.351(6)(ii)3., Florida Statutes where applicable

Assumption limited to the number and types approved by the Office (up to 30,000 policies) and any additional assumptions require advance written Office approval

Maintain catastrophe reinsurance at levels acceptable to the Office (no less than levels evidenced in FPIC's proposal) and comply with Section 624.610, Florida Statutes

Notify the Office in writing 60 days prior to termination of any reinsurance agreements

Participate annually in examinations of FPIC's reinsurance program and take corrective actions as directed by the Office (including obtaining additional reinsurance or suspending writing additional business)

Provide coverage upon expiration of assumed Citizens policies substantially equivalent to Citizens coverage at Office‑approved or filed 'use and file' rates, unless lawfully cancelled or nonrenewed

Include an Office‑approved consumer disclosure in any offers to Citizens policyholders explaining differences between FPIC and Citizens policies

No offers may be made that are more than 40% higher than the Citizens estimated renewal premium; offers must use Office‑approved rates or rates filed as 'use and file'

FPIC must either obtain a new application from each affected policyholder or retain Citizens' application; if obtaining a new application, FPIC may not retroactively increase rates or decrease coverage as a result

FPIC shall not use any incentive or bonus plan for the assumed policies

FPIC must enter into appropriate, executed agreements with Citizens to effectuate assumptions; draft or non‑executed documents are not approved until executed and submitted to the Office

FPIC must provide information required by Citizens' 2024 Assumption Calendar as requested

FPIC must abide by the proposal in all material respects for three years following entry of the Consent Order

Remedy for material noncompliance

Should the Office determine FPIC has failed to materially comply, FPIC has 60 days to cure the noncompliance
If FPIC fails to cure within 60 days, the Office may order remedies including cessation of writing business, sanctions, or other restrictions

FPIC waives rights to hearing and to appeal this Consent Order

Approval to assume is granted subject to all terms and conditions of this Consent Order

Rates and Reinsurance Requirements

inv-02: Maximum takeout offer premium increase — 40%

Maximum allowed increase for takeout offers40%

Rate filing requirement for takeout offersMust use rates approved by the Office or filed as 'use and file'

Applicability contextApplies to takeout offers to Citizens policyholders in connection with the assumption of selected policies

inv-03: Minimum catastrophe reinsurance level — No less than levels evidenced to the Office in FPIC's proposal

Minimum catastrophe reinsurance levelNo less than the levels evidenced to the Office in FPIC's proposal

Office acceptance clauseMaintain catastrophe reinsurance at levels acceptable to the Office

Reinsurance notification requirementNotify the Office in writing 60 days prior to termination of any reinsurance agreements

Statutory complianceComply with the requirements of Section 624.610, Florida Statutes, regarding reinsurance arrangements

Restrictions and Policyholder Requirements

Billing Rule

Limit on takeout offer price and required rates

FPIC shall not make takeout offers to Citizens policyholders that are more than forty percent higher than the policyholder's estimated renewal premium with Citizens; offers must use rates that have either been approved by the Office or rates filed with the Office as "use and file."

Documentation Required

Application and prohibition on retroactive rate/coverage changes

At the time of assumption, FPIC must either obtain a new policy application from each affected policyholder or retain a copy of the policyholder's application on file with Citizens; if FPIC obtains a new application it may not initiate any retroactive increase in rates or premium or any retroactive decrease in coverage as a result.

Referenced Plans and Authorities

inv-06: "Citizens Property Insurance Corporation Personal Residential and Commercial Lines Non-Bonus Depopulation Plan" — basis for this Consent Order except where it conflicts with updated Florida statute Section 627.351(6)(ii)3.

Depopulation Plan identified"Citizens Property Insurance Corporation Personal Residential and Commercial Lines Non-Bonus Depopulation Plan"

Plan as basis for Consent OrderThe Plan provides the terms and conditions that serve as the basis for this Consent Order

Conflict with updated statutePlan controls except where it conflicts with Section 627.351(6)(ii)3., Florida Statutes (as added by ch. 2022-271(8), Laws of Florida)

Controlling law when conflict existsFlorida Statutes in effect at the time of the assumption will control when the Plan conflicts with Section 627.351(6)(ii)3.

Requirement to abide by bothFPIC shall abide by the terms and conditions of the Plan and Section 627.351(6)(ii)3. as a condition of issuance of this Consent Order

Policy Summary

PayerFlorida Office of Insurance Regulation

PolicyConsent Order approving FPIC assumption of Citizens policies

Policy CodePolicy N/A

Change TypeNo material changes

Effective DateOct 31, 2023

Last ReviewDec 2, 2023

Next Review DateN/A

Key ActionFPIC shall not make takeout offers more than 40% higher than the policyholder's estimated renewal premium and must use Office-approved or use-and-file rates.

SourceLink

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