TALLAHASSEE — One among Florida’s largest property insurers could possibly be going out of enterprise after a scores company withdrew its evaluation of St. Johns Insurance coverage Co. on Thursday.
With out its “A” score, St. Johns’ 140,000 prospects in Florida could possibly be compelled to search out new protection. The state’s Workplace of Insurance coverage Regulation stated it was working with the corporate to search out choices to make sure its prospects wouldn’t lose protection.
Already, one choice seems to have emerged. On Friday, the commerce publication The Insurer reported that Tampa insurance coverage startup Slide has petitioned the Workplace of Insurance coverage Regulation to take over St. Johns’ insurance policies on March 1.
A spokesperson for Slide declined to remark, and a spokesperson for the Workplace of Insurance coverage Regulation didn’t reply when requested to substantiate that Slide had reached out to its workplace.
Calls to St. Johns’ president and chief working officer weren’t returned.
The Orlando-based firm seems to be the newest casualty in Florida’s property insurance coverage market, the place charges have been skyrocketing and a handful of insurers have gone out of enterprise in the previous few years.
St. Johns, established in Florida in 2003, has been identified to be in monetary hassle for at the very least a 12 months. Final 12 months, scores company Demotech warned that St. Johns and 5 different insurers wanted to enhance financially in the event that they needed to maintain their “A” score.
Earlier this week, St. Johns introduced it was now not writing householders’ insurance policies in Florida, becoming a member of at the very least a dozen different insurers which have lately suspended new enterprise, restricted the varieties of houses they cowl or canceled insurance policies outright.
Joe Petrelli, president of Demotech, one in all two scores businesses for Florida-based insurers, stated in a press release that the choice to take away the corporate’s “A” score got here after reviewing the corporate’s latest monetary statements.
“Based mostly upon our latest dialog with St. Johns, we concluded that they might not meet the standards for sustaining (a monetary stability score) of A and we withdrew their (score),” Petrelli stated in a press release.
For householders, the score is important: Most mortgage lenders require the home-owner have insurance coverage from a rated firm.
When Demotech pulled the score of St. Petersburg-based American Capital Assurance Corp. final 12 months, the corporate was ordered into receivership a couple of month later.
Petrelli, echoing the claims of insurers and plenty of lawmakers, stated the trade “is fraught with claims inflation, fraud and properly above common litigation charges” which have put a pressure on insurance coverage companies.
As an illustration, some level to fraudulent claims from roofers going door to door providing to assist householders substitute their roofs as a significant factor in trade losses. State lawmakers this session are contemplating altering state regulation to permit insurers to supply insurance policies that may make householders pay extra to switch their roof.