In recent years, Florida’s property insurance market has seen a surge of new entrants, many of which are startups with little public presence. Some of these companies are so new that they operate without visible signage at their offices, yet their executives are earning record-high compensation. Disclosures reveal that CEOs of these newly formed insurers have seen their pay increase by more than 50%, surpassing $7 million annually in some cases.
The landscape of Florida’s insurance market has been reshaped by a combination of factors: the state’s highest-in-the-nation premiums, policyholder departures from Citizens (the state-run insurer), and aggressive takeouts by private carriers. Companies like Heritage Property & Casualty Insurance Co. and Mount Beacon Insurance Co. have rapidly expanded by absorbing tens of thousands of policies from Citizens. In June alone, approximately 45,000 Citizens customers received offers to switch to these private insurers. As a result, Citizens’ customer base has dwindled to fewer than 600,000 policyholders—down from a peak of nearly 1.5 million.
This rapid growth comes with its own set of concerns. From 2003 to 2009, 11 of the 29 companies that took over Citizens policies eventually became insolvent. Mount Beacon, less than a year old at the time, had already acquired over 31,000 customers by early 2015, yet its physical office presence was limited to a P.O. box and a service agent’s office.
Heritage, on the other hand, has seen extraordinary growth, rising from zero customers just a few years ago to the fourth-largest property insurer in the state, with over 220,000 policyholders. Much of Heritage’s expansion was fueled by state-approved takeout deals, including a 2013 agreement that allowed the company to assume up to 60,000 Citizens policies—an arrangement approved by a narrow 3-2 board vote. Heritage has also benefited from political contributions, including a $110,000 donation to a gubernatorial committee shortly before securing its lucrative takeout deal.
The financial rewards for Heritage’s executives have been significant. The CEO’s compensation package grew by more than 50%, exceeding $7.1 million in 2014, with additional stock holdings valued at over $40 million. The company also acquired SVM Restoration Services, a firm founded by the spouses of Heritage’s leadership team, further consolidating profits by providing water mitigation and repair services to its own policyholders for $2.5 million in cash.
Meanwhile, employees across the board have seen dramatic pay increases, with some salaries doubling in a single year. Heritage has continued its aggressive growth strategy, gaining approval for an additional 20,000 Citizens takeouts in July and another 10,000 through Southern Oak Insurance Co.
Despite this success, questions remain about the financial stability of these rapidly expanding insurers. Florida law requires insurance carriers to meet minimum standards, such as securing adequate reinsurance to withstand a 1-in-100-year storm event. Heritage holds a “C” rating from Weiss Ratings, while Mount Beacon is considered too new for a formal evaluation. The state has been fortunate to avoid a major hurricane for nearly a decade—an anomaly that has undoubtedly contributed to the profitability of these companies. However, industry experts caution that the risk exposure for many takeout companies may exceed their financial strength.
For policyholders, these developments underscore the importance of vigilance and preparedness. Insurers may be thriving, but homeowners and business owners must remain proactive in protecting their rights—especially when claims are denied or underpaid.
That’s where Mineo Salcedo Law Firm comes in. As experts in Florida property insurance claims, Mineo Salcedo Law Firm stands with homeowners, associations, and business owners when they face challenges with their insurance companies. Whether you are dealing with a denied claim, delayed payout, or navigating the complexities of a policy transfer, the attorneys at Mineo Salcedo Law Firm are dedicated to helping you recover the compensation you deserve. Let them advocate for your rights and ensure your property is protected—because in a market designed to protect insurers’ profits, you need a legal team focused on protecting you.
