Mainsail Insurance approved to write in Florida

November 30, 2023

Mainsail Insurance Co., is a newly formed carrier, which is wholly owned by Spinnaker Insurance Co. The parent company is Hippo Holdings Inc., which acquired Spinnaker Insurance Co., on Aug. 31, 2020.

The Florida Office of Insurance Regulation has approved Mainsail Insurance Co., a property/casualty insurer headquartered in Texas, to function as a domestic insurer within Florida. The insurer has been approved to offer 17 varying lines of insurance, including auto, property, and commercial coverage.

Mainsail Insurance is the second company to be allowed in Florida as an authorized insurer following the passage of H.B.837 earlier this year, which aims to stabilize the state’s insurance marketplace through comprehensive tort-system reform, including a shift from pure comparative negligence to a modified comparative negligence system.

New law allows for new growth

Under the pure comparative negligence system, a plaintiff could recover in proportion to the percentage of responsibility as assessed by the factfinder. Now under the modified comparative negligence system, a plaintiff is barred from recovering if the fact-finder attributes more than 50% fault to the plaintiff. The new law also restricts bad-faith claims against insurance companies, modifies premises liability, and limits attorneys fee awards.

Before H.B.837 passed, Florida homeowners paid nearly three times more than the national average for home insurance, according to the Insurance Information Institute. The higher premiums are a result of an exodus of insurers leaving the state. As of January 2023, 15 insurers have been deemed insolvent since 2020—leading to the dwindling number of market options for homeowners.

A swing in a different direction

However, the addition of Mainsail Insurance to the Florida market shows that recent legislative reforms are having a positive impact for consumers.

The Florida Office of Insurance Regulation advised it has approved insurers to assume 280,000 policies from the Citizens Property Insurance Corp., through October 2023. Several companies have submitted proposals to acquire policies from Citizens.

The Florida Legislature created the Citizens Depopulation Program to reduce the number of policies written by the state-run insurer because of the passage of S.B.2-A and S.B.2-d last year.

Citizens Property Casualty, which was created as an insurer of last resort, became the largest property insurer in the state as private companies have dropped customers and raised rates due to financial challenges related to natural disasters and rapidly inflating costs of labor and materials to repair or replace damaged property.

Projections may be lower if depopulation measures prove to be effective at moving a portion of property owners back into the private market as reforms enacted over the last several years begin to take effect.

Citizens Property Casualty’s rates are significantly less than going through the private market—which can cause problems. To correct this, the company plans to increase its premiums, so it is in line with private-insurer premiums. The Citizens Property Casualty board of governors internally sanctioned a proposal that grants organizational leaders the opportunity to petition the Florida Office of Insurance Regulation for authorization to implement a 14.2% hike in policy premiums.

Helen Horn, CIC, CPIA, CISR
PIA Northeast

Helen K. Horn, CIC, CPIA, CISR, joined PIA in 1998 with nearly 20 years of industry experience in property/casualty insurance agencies. In her current position as industry resource representative, her primary responsibilities include providing assistance to PIA members on technical and coverage issues. She also serves as the primary staff person for PIA’s company tracking and company insolvencies, guaranty funds, New York Automobile Insurance Plan, workers' compensation and life/health member concerns. She also manages PIA’s BusinessLink™ Program. Helen received her associate’s degree in vocal performance from Onondaga Community College in Syracuse, N.Y., and a bachelor of arts degree in vocal education from Keuka College, Keuka Park, N.Y.

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