New Insurer Sets Sail in Florida’s Stormy Waters, Credits Legislative Reforms

For the first time in almost a decade, a new insurance carrier is wading into the troubled Florida waters, and is expected to make take-out offers to more than 42,000 Citizens Property Insurance policyholders.

VYRD Insurance Co., based in St. Petersburg, is a joint venture of SiriusPoint Ltd., a Bermuda specialty insurer and reinsurer, and Bolttech, an insurtech firm, according to the South Florida Sun Sentinel newspaper and Florida regulators. VYRD will be led by David Howard, formerly with Lighthouse Property Insurance and Edison Property Insurance, both based in Florida.

The Florida Office of Insurance Regulation granted VYRD a certificate of authority in late November. The selected policies taken from Citizens will be transferred starting in February, according to a consent order that authorized the move.

The startup and takeouts are being hailed as good news for Florida and for Citizens, the state-backed insurer of last resort that has seen rapid growth and has become one of the largest homeowners’ insurance companies in the state. Four carriers in Florida have become insolvent in the last few years and others have pulled out of the market altogether, despite steady rate increases for consumers.

Florida Insurance Commissioner David Altmaier said that VYRD officials noted that the launch of the carrier was “directly attributable to the passage of Senate Bill 76.”

SB 76, approved by the Florida Legislature early this year, made a number of reforms designed to reduce insurance claims litigation, attorneys’ fees, and solicitation of homeowners by contractors promising that insurers will pay for all-new roofs.

“Hopefully we can continue momentum and forward progress on initiatives like that and continue to demonstrate that Florida has some challenges that we need to work through, but we are willing as an industry and as policy leaders to work through those things,” Altmaier said last week at the Florida Chamber of Commerce Insurance Summit.

He noted that VYRD has raised almost $50 million in capital. Part of that may come from Kole Inc., a Delaware-registered corporation, according to the Florida certificate of authority.

VYRD’s joint venture with Bolttech comes three months after Bolttech announced it had raised $210 million in capital and to expand its technology-based services. The firm, with offices in the U.S., Europe and Asia, calls itself one of the fastest-growing international insurtech firms, serving 150 carriers. Its platform is designed to help carriers mitigate risk in property coverage.

News outlets have reported that a subsidiary of China-based Minsheng Investment Corp. owns 35% of SiriusPoint. The ownership has raised questions in Florida, where top elected officials have taken measurers to dampen the influence of countries considered hostile to the United States, including China.

On the takeout of Citizens’ policies, it’s too soon to known how many policyholders will accept the offer. Under Florida law, VYRD will have to notify homeowners, who can opt to stay with Citizens. Citizens’ officials are hoping for legislation next month that will bar policyholders from refusing takeout offers if the offer is expected premiums are less than 20% higher than Citizen’s prices.

The certificate authorizing VYRD and the takeout consent order note that the carrier must maintain catastrophe reinsurance at appropriate levels. If OIR determines that VYRD has failed to comply with the order, the company will have 60 days to rectify. If it misses that deadline, the office may order it to cease writing personal lines in Florida, the consent order reads.

Topics Florida Carriers