ORANGE COUNTY, Fla. — Can Citizens Insurance payout claims if there’s a major disaster? And, will they need a federal bailout? The U.S. Senate Budget Committee chair leading the probe into Citizens is asking these questions. He claims Citizens Insurance is not cooperating.
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Senator Sheldon Whitehouse sent another letter to Florida’s insurer of last resort this week after Governor Ron DeSantis weighed in on Citizens, telling CNBC in February that Citizens “is not solvent.” Essentially, DeSantis said, the insurer wouldn’t be able to pay out claims if a major storm hits and Florida still had millions on Citizens.
The Senate Committee on the Budget launched a probe last fall and requested a list of information and documents. The chair says Citizens has not provided that.
Citizens said in a statement “the financial structure ensures that it will always be able to pay claims,” adding it’s never asked for a bailout and “can think of no scenario in which Citizens would be required to seek federal financial assistance.”
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Orlando insurance agent Tom Cotton agrees.
“Citizens will never be bailed out by the federal government. First of all, Citizens has enough surplus in cash to pay for two times their exposure,” Cotton told Channel 9.
According to Whitehouse’s letter, Citizens has until next Thursday to respond to the Senate Committee’s request. However, Citizens told Channel 9 it answered all of the committee’s questions.
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Clinton Mora is a reporter for Trending Insurance News. He has previously worked for the Forbes. As a contributor to Trending Insurance News, Clinton covers emerging a wide range of property and casualty insurance related stories.