Citizens Property Insurance

More than half of the estimated $850 million costs of damages from Hurricane Charley will be paid by Citizens Property Insurance Corp. to the property owners in Sanibel and Captiva, Florida. Thirteen percent of Citizens Property Insurance Corp's business falls in these two regions in Lee, Collier, and Charlotte counties. But despite this seemingly small percentage, Citizens Property Insurance Corp is estimated to pay $526 million to Sanibel and Captiva property owners. This is roughly 62 per cent of the total damage claims that Citizens Property Insurance Corp is facing today.

Susanne Murphy, the corporate counsel of Citizens Property Insurance Corp cautions that these estimates are merely derived from computer models. She further says that these estimates from computer systems at Citizens Property Insurance Corp have been adjusted downward at least once already. Citizens Property Insurance Corp has declared that the estimates are preliminary and not based on actually claims.

Yet even so, the numbers that Citizens Property Insurance Corp was able to come up with were shocking. The potential destruction that one hurricane – there were three earlier hurricanes before Charley – can do has led Citizens Property Insurance Corp to consider adopting drastic measures to overcome the potential liability. These drastic measures that Citizens Property Insurance Corp is planning on taking include limiting coverage and raising premium rates on more expensive homes in high-risk areas. The estimated increase in premium of policies by Citizens Property Insurance Corp is said to reach up to 67 per cent.

So far, only of the 5,478 Sanibel and Captiva policyholders at Citizens Property Insurance Corp. have filed claims. Citizens Property Insurance Corp has already paid out more than $115 million statewide due in damage claims from Hurricane Charley. Out of this figure, Citizens Property Insurance Corp paid $14.9 million to Sanibel property owners. In addition, Citizens Property Insurance Corp also paid out $5.7 million to property owners in Captiva.

$750,000 is the highest claim that Citizens Property Insurance Corp paid for the area. For damaged property in Sanibel, Citizens Property Insurance Corp has also set aside $3.3 million. With Charley's damage, Citizens Property Insurance Corp is facing a total net loss of $1.779 million, including losses they have encountered from the previous hurricanes.

To alleviate their losses, Citizens Property Insurance Corp called for board meeting. This Citizens Property Insurance Corp board meeting, discussions about limiting the amount of coverage property owners can get for hurricane damage. Citizens Property Insurance Corp considered the figure $1 million for hurricane coverage. The members of the Citizens Property Insurance Corp Board have also decided on raising deductibles to 5 per cent or 10 of the insured value as they are in the voluntary market. Currently, Citizens Property Insurance Corp offers homeowners a choice between a 2 per cent deductible and any price property eligible for wind coverage.

It is also a likely possibility that Citizens Property Insurance Corp will charge higher rates for expensive property. This is according to Bob Ricker, the president and executive director of Citizens Property Insurance Corp. The move is based on current rate trends in the market. The higher the value of the home, the higher the price of policies that Citizens Property Insurance Corp offers.