Citizens

Citizens Property Insurance Corp. is a state-created entity that serves as the insurer of last resort for policyholders locked out of the private market.

Changes made by the legislature ended requirements that Citizens charge the highest rates in Florida and also allowed more policyholders to obtain Citizens coverage.

Eligibility requirements for a Citizens policy were changed to allow for people who are unable to find coverage and those who are unable to find affordable coverage to obtain a policy. Citizens has almost 1.1 million policyholders.

In order to buy coverage from Citizens, consumers must either be rejected by other insurers or have a quote for coverage that is more than 15 percent higher than a similar quote for coverage from Citizens.

Citizens policies do not offer the same breadth of comprehensive coverage options as some private insurers. For example, Citizens has limited loss-of-use coverage, the coverage that would pay your living expenses if your house was heavily damaged or declared a total loss and you were forced to live in a hotel or temporary apartment.

Citizens will only pay living expenses of up to 10 percent. Private insurers, in contrast, normally pay up to 20 percent.

Another limitation is that personal property coverage is limited to 50 percent of the value of your home.

If your home is valued at $200,000, you are limited to $100,000 coverage for all your personal belongings. This includes all your furniture, electronics, clothing for your entire family, and all household goods. Private insurers usually offer personal property coverage of up to 70 percent.

Citizens also does not offer optional coverage for artwork, antiques, collectibles and jewelry.

Other caps include limiting liability coverage to $300,000. If a neighbor trips in your house and sues you, the most Citizens would pay is $300,000. Private insurers can offer liability coverage of $1 million or more.

On the Web: www.CitizensFla.com

State Farm

State Farm negotiated a deal in December 2009 that will keep it in the state, but allows the company to drop some clients in high-risk areas such as South Florida.

The plan also allows State Farm — the state’s largest private insurer — to hike its rates by an average of 14.8 percent, although some customers will see larger increases.

About 125,000 households will be dropped by State Farm, which began sending out notifications to those customers in February. Cancellations will start in August, when the rate increases take effect.

The agreement also allows its agents to write policies for other insurance carriers.

It’s likely the state-run Citizens Property Insurance Corp. will have to pick up some policies.

State Farm had said it would pull out of Florida completely, leaving 806,000 residents looking for new insurance, after the Office of Insurance Regulation denied a 47 percent rate rise in 2008.

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