As an investment management organization and a record of insurers financial stability, Demotech is not a problem in the insurance markets that are difficult, such as Florida, Louisiana, or elsewhere, according to Steve Menzies, Chairman of Applied Underwriters.
Menzies runs through the domestic issues that the Florida market has been facing and explains that Demotech has been placed in a difficult position, due to the disruption of the state’s insurance market.
“Many insurance companies, especially small, one-of-a-kind carriers, face an endless battle, against testing tools that have become increasingly sophisticated in the use of data technology and increasingly influential in creating fraudulent policies,” Menzies said.
Saying, “This has put Demotech, a property insurance agency in the coastal areas, in a difficult position to explain the difficult financial truth and has unwittingly dragged it into the limelight of a change that will not happen. Florida parliament and in other countries.”
This “hard financial reality” is that several carriers in Florida do not have the capacity, or the power, as they need to continue to manage what Demotech offers.
Something that has sparked controversy from Florida lawmakers, which has led to further threats to defund Demotech.
“Demotech as a goalkeeper is not a problem Florida, Louisiana, or anywhere else,” said Menzies. Explaining, “It’s the power of the courts over state law and the entire claims process, which leads to a broken system with an unsustainable economy.”
Menzies describes the challenges facing Florida’s insurance market as follows:
- Limited availability of commercial market protection available to insurers due to hurricane risk.
- Quote, “Atrocious, law-enforcement labs have “gamed” the rules and regulations by using unfair and unconscionable methods to exploit them, such as people-shifting and profit-sharing.”
- Insurance policies have been inadequate for many years and carriers have failed to raise them sufficiently to cover the problems caused by losses and damages caused by lawsuits, which have been “disrupting the risks underwritten.”
Menzies said his carrier, Centauri Specialty Insurance Co. and Centauri National Insurance Co., which both write in coastal states as well Florida and Louisianareceived ‘A’ (Exceptional) certification by Demotech.
“We are committed to continuing to be profitable in coastal communities, including Florida market, where we’ve been able to outperform the weather, including Hurricane Ida and other major losses,” Menzies said.
With Florida’s insurance market struggling and stress seemingly intensifying, as premiums and write-offs begin, Applied’s sister company Centauri is seeing increased demand from policyholders.
To lead Rick EspinoCEO of Centauri said, “Agents are advised to send renewals and request plans as soon as possible. We are achieving our new goals for the quarter very quickly. While the market is suffering from confusion and lack of availability, we find that we are receiving a significant increase in shipments.
“While our business is in progress Florida usually located in the BOP commercial sector, after gradually withdrawing from the troubled home owner market there, we continue to grow our home owner business along the coast and be ready to support our agents and their clients’ needs. “
The comments of Menzies are explained, but they also represent the opinion that many people see that Demotech has been very difficult around this mid-year reinsurance renewals, it is a special sector that seems not to have been given fast enough to change the economy of the carriers that they now have to vote, when many are in need of reinsurance and money additions.
Whatever your view of one accounting firm versus another, the current state of Florida has made the accounting industry very difficult and it seems that Demotech has stuck to its guns and not given up on some powerful ideas.
With the authorities have now prepared a guarantee of the type of backstop and Citizens, which should help some low, but possible, carriers to continue to work, it is important to see the health of the Florida insurance group is provided, making the accounting agencies more. important to the future health of the market.
Read all of our news and analysis of the Florida insurance and reinsurance market.
– Demotech removes two ratings for Bankers. Review the Sep cycle.
– Florida Family Insurance Companies was also downgraded by Demotech.
– Demotech downloads UPC, removes FedNat & Weston, verifies others.
– Senator Rubio wants Florida Federal to review Demotech trust.
– Demotech says Florida insurance ratings will take longer, defends its strategy.