http://www.sun-sentinel.com/business/custom/consumer/sfl-ztakeout03sep03,0,3838326.story?page=1&track=mostemailedlinkMichael Burrell never asked for a new insurance policy for his Boca Raton home. Because he lives east of Interstate 95, an area where few private property insurers are willing to tread, Burrell assumed no company other than state-backed Citizens Property Insurance Corp. would cover the wind risk on his three-bedroom, three-bathroom home. Then in late June, Burrell got a notice in the mail that his coverage was shifting to a different insurer. Last year, his annual premium cost $1,595. This year, it's $4,581 -- a 187 percent increase.
Staying with Citizens wasn't an option. With a private insurance company now offering to cover his home, Burrell couldn't refuse -- no matter the price. This problem exposes an unintended hitch in Citizens' "takeout program," state insurance officials say, in which private insurers are taking policies from Citizens but charging much more than the state-run home insurer. The law says Citizens is a last resort for homeowners who have no options for private insurance coverage.
Burrell is one of 41,628 Florida homeowners who will be switched this year from Citizens to either Florida Peninsula, a year-old company in Boca Raton, or to Homewise Insurance, a Tampa firm that just started doing business this year.
The two companies are participating in the takeout program, which allows private companies to take homeowner policies from Citizens, now Florida's largest property insurer. Both companies are targeting homes in Citizens' so-called high-risk area, which is generally east of Interstate 95 or U.S. 1 in South Florida.