Florida homeowners have told Newsweek they are being “ripped off” and put into financial difficulty as the state’s largest home insurance provider moves to cut the number of its policies.

Earlier this year, regulators in the Sunshine State approved proposals allowing private insurers to take policies from Citizens Property Insurance Corporation as the number of policies has soared in recent years. Citizens, created by the Florida Legislature in 2002, provides insurance to eligible Florida property owners who cannot find insurance coverage in the private market.

“Citizens is committed to helping its policyholders find coverage in the private market,” its website reads. “As required by Florida law, Citizens’ Depopulation Program matches Citizens policyholders with insurance companies interested in removing their policy from Citizens and providing private-market coverage for their policy.”

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Despite being the insurer of last resort in the Sunshine State, the number of Citizens policies has ballooned in recent years as private insurers dropped customers and raised rates due to losses caused by payouts and litigation. As of the end of September 2024, Citizens had 1,263,055 policies in force. Five years ago, in September 2019, it had 421,332 active policies.

Many Florida homeowners are now facing higher insurance premiums with alternative providers. Citizens explains on its website that anyone offered a new policy that is 20 percent more than their current one does not have to take up the offer. But if it is less than that, you will be moved to the cheapest coverage option, with no choice to remain with Citizens. While a policy is in the process of being moved and the holder is deciding what to do, this is known as the “assumption period.”

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“I can’t afford to leave and I can’t afford to stay,” Havana resident Henry Williams, who asked to have his name changed, told Newsweek. “In the long run, it is possible I may lose my home, which is my only source of any wealth in retirement.”

‘I Don’t Sleep at Night’

Williams, a 71-year-old retiree, received a notice from Citizens saying he was up for depopulation in September, and after speaking to his insurance broker, he requested to remain a Citizens customer. After witnessing a friend “basically relinquish” their home due to unaffordable home insurance, he now fears that the worst could happen.

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“We are like a lot of older people here trying to live on very fixed incomes and now seeing what ‘wealth’ we have, [like] the value of our properties, drain away and are powerless to stop it,” he said.

“Even if we can sell, at this point, I foresee property values dropping drastically. It’s a nightmare for everyone but hits retirees especially hard. I don’t sleep at night.”

Others have also expressed worry and anger about how much their premiums are rising due to the depopulation program.

Gordon Garreau Sr. told Newsweek he feels “pushed out” of his Citizens policy. He said his current annual premium of $4,700 will jump to $5,250 with his new provider, Florida Peninsula, which he said is “ripping people off.”

George Matter, 64, who has lived in his home in Port St. Lucie for 35 years, was told he would be depopulated from his current Citizens policy, which cost him $3,550 per year, to a new policy costing him $4,200. He said the new policy would also have less coverage, meaning he is paying more for less.

“Love our governor always saying that Florida is the most free state in the nation,” he told Newsweek. “Somehow, I don’t feel very free.”

Florida residents are grappling with some of the highest home insurance rates in the country. According to Bankrate, the average insurance cost for a home valued at $300,000 in October 2024 was $5,527 per year—much higher than the rate for a home of the same value in neighboring Georgia ($2,071) and Alabama ($2,745).

The average home insurance cost in Florida is $3,242 more expensive than the national average of $2,285. In some areas, premiums can climb to higher than $8,000. The state average is second only to Nebraska, where the average premium on a $300,000 home is $5,652.

While heightened costs are the primary concern of the homeowners who shared their stories with Newsweek, others took issue with how the depopulation program is being conducted. Largo resident Angela Irizarry said that along with a premium increase from a provider that Citizens offered her, “we have no idea what kind of insurance company we’re going to be stuck with.”

“We had no say in the matter,” she told Newsweek. “That in itself is hard to swallow.”

What Is Happening at Citizens?

With a record number of policies on its books, Florida lawmakers authorized the depopulation program earlier this year. This year, the Florida Office of Insurance Regulation (FLOIR) has approved the depopulation of hundreds of thousands of policies in accordance with laws signed earlier this year.

“For 2024 through October, 369,768 Citizens policies have been assumed by private companies that have been approved to participate in the depopulation program by the FLOIR,” Citizens spokesperson Michael Peltier said.

Through June, Citizens sent out 217,623 offer letters to impacted policyholders, he said. Of those, 75,955 policyholders with offers more than 20 percent higher than their current policies opted to remain with Citizens. Of the 132,445 policies that were assumed through June, 35,431 received offers with premiums equal to or less than Citizens, and 87,791 received offers that were no more than 20 percent higher and 10,223 received offers sub 20 percent.

Citizens told Newsweek that its depopulation program is a sign that Florida’s insurance market is improving, given the increased number of insurers that have shown interest in taking over its policies.

“Interested companies contact the FLOIR, which reviews their applications and, if it approves, issues an order to Citizens to make a specific quantity of policies available for a specific ‘assumption period,'” Peltier said.

“The private insurer then looks at Citizens’ portfolio and chooses policies that fit their business strategy. Maybe they are looking for newer homes, newer roofs, or policies in a particular geographic region, for example.”

“Policyholders who receive offers that are within 20 percent of their Citizens premium do not have to accept the offer, but they are ineligible to remain with Citizens,” he said, clarifying that “many policyholders will receive multiple offers from different private companies.”

“In many cases, policy offers are coming in at rates close to, or even below Citizens’ premiums and/or with more comprehensive coverage,” Peltier continued. “We encourage our policyholders to talk to their agents to determine what works best for them.

“There is no firm target for depopulation. We estimate that there are between 450,000 and 600,000 policies in Florida that would be considered residual in a healthy insurance market.”

Are you considering leaving Florida due to high insurance costs or other reasons? Get in touch at a.higham@newsweek.com.