Andrew Tang, Chief Investment Officer of Turner Financial Group, has highlighted the challenges facing Florida’s property insurance market. He said that “litigation, fraud, and storm risks have made private home insurance unaffordable for many Florida homeowners,” leading them to seek coverage from the state-run Citizens Property Insurance.
“In Florida, about 15-20% of homeowners struggle to secure private insurance due to high litigation, fraud, and hurricane risks,” said Tang. “Citizens covers roughly 20-25% of the state’s 5 million owner-occupied homes. Critics call Citizens subpar for its limited coverage, higher claim denials (over 50% last year) Recent reforms aim to stabilize the market, with new private insurers entering in 2024.”
Florida’s property insurance market is currently grappling with issues such as hurricane exposure, litigation, and insurance fraud. These factors have resulted in increased premiums and limited availability of private insurance coverage. According to Insurance Business Magazine, reciprocal insurance exchanges have emerged as a model to provide coverage in high-risk areas by allowing policyholders to pool resources to insure each other. Several reciprocal exchanges have entered Florida’s market, offering an alternative to traditional insurers in catastrophe-prone regions.
Citizens Property Insurance Corporation, Florida’s state-run insurer, has experienced fluctuations in its market share. Efforts are underway to diversify the insurance market by introducing reciprocal exchanges. As reported by the Florida Office of Insurance Regulation, these exchanges offer policyholders ownership stakes and potentially more tailored and responsive coverage options. The regulatory body has approved several reciprocal exchanges to operate in the state with the aim of increasing competition and reducing reliance on Citizens.
Reciprocal insurance exchanges function on a member-centric model where policyholders act as subscribers who participate in governance and share underwriting profits. This structure can lead to more transparent decision-making and better alignment with policyholder interests. The Florida Office of Insurance Regulation states that forming a domestic reciprocal insurer involves establishing a Subscribers’ Advisory Committee, which plays a crucial role in governing the exchange.
Tang brings over 20 years of experience in financial services at Turner Financial Group, focusing on wealth protection and growth through customized strategies. He supports advisors by leveraging managed platforms and providing tailored investment solutions. Tang holds a BA in Economics from Boston University and certificates from New York University; he previously served as CIO at Claraphi Advisory Network.
