Is My Property Insurance Company in Fort Lauderdale Allowed to “Drop” Me?

Today, countless Florida homeowners face the risk of losing home insurance. This loss can occur in many ways. First, home insurance may simply become too unaffordable for a property owner, to the point where they have no other option but to walk away. Another possibility involves being “dropped” by your insurer. But are insurance companies really allowed to do this? This is a question you might want to ask a Fort Lauderdale property insurance lawyer.

“Cherry-Picking” Is Common in the Private Insurance Industry

According to a recent article by MSN, the practice of “cherry-picking” has become quite common in the insurance industry. To understand this practice, you first need to understand the “insurer of last resort.” Florida is not the only state to have an insurer of last resort, and this is a state-owned insurance organization that essentially captures homeowners who can’t get insurance anywhere else. In theory, the insurer of last resort should ensure that no one “falls through the cracks.”

In Florida, the insurer of last resort is Citizens. Even though it is a state-owned enterprise, Citizens still charges policyholders high premiums. That said, premiums through Citizens are generally cheaper than those levied by private insurance companies. That said, you must switch over to a private insurer if you receive an offer from one of these companies as a Citizens policyholder.

Private insurers can choose which Citizens policies they want to pick up. This process is called “cherry-picking,” and it is controversial for various reasons. First, companies can choose only the safest or most attractive policies, leaving the riskier options with Citizens. This allows mainstream insurance companies to profit considerably, but it leaves the most vulnerable policyholders stuck in a system with what the Washington Post calls “some of the worst claims handling and processing times.”

Can My Insurance Company Drop Me? 

An insurer can only terminate your policy under certain circumstances. These circumstances should be clearly described in your policy, and you have the right to review the specific wording of the termination clause alongside an experienced lawyer. If you believe that your insurer is dropping you in retaliation for something you had the right to do (such as filing a claim), you may be able to take legal action. This is something you may want to discuss with an experienced property insurance lawyer.

Contact Our Fort Lauderdale Property Insurance Lawyers Today

At Fuxa & Tyler, our legal team is made up of a diverse combination of attorneys who are well-positioned to protect the legal rights and financial interests of policyholders. If your property insurance claim was denied, we can help. For a free consultation, please call us today at (954) 990-5251. With an office in Sunrise, we represent policyholders in Broward County and throughout the state of Florida.

Sources: 

insurancebusinessmag.com/us/news/catastrophe/three-insurers-approved-to-take-over-135000-citizens-property-insurance-policies-529534.aspx

washingtonpost.com/climate-environment/2023/12/30/florida-insurance-citizens-slide/