Surplus Lines Carriers
Make sure that you ask if your insurer is a surplus line carrier.
Lloyds is a surplus lines carrier not regulated by the state of Florida. The rates they are charging are not regulated. If a surplus lines carrier were to go insolvent then the state would not take over paying any claims. That protection for consumers under the Florida Insurance Guaranty Act does not apply to surplus lines carriers.
USF&G is also a surplus lines company they are not subject to the rating structure of
the State of Florida OIR. They also can charge what the market will bear. Hull & Company is another lines carrier.
Surplus line carriers appeared after Hurricane Andrew when the state allowed them into the state to increase options in the insurance market as carriers started this pull out in 1992.
Surplus line carriers were allowed to move into our residential market, but primarily these carriers (Lloyds of London) do not cover standard residential real estate but rather business and very high risk in terms of dollars to replace.
But seeing a market the surplus line carrier was allowed by our state lawmakers to move into the residential real estate market in Florida.
These carriers are not regulated as to rates, and should they go bankrupt there is absolutely no protection by the state to back up the policy leaving the policy holder with nothing.
As the state doesn't regulate the rates or other charges the increases in premium can be extreme even compared to Citizens if you can think that it is possible. The wind deductible is nearly always a flat 5%. If you have less savings or access to money, chances are you cannot afford a 5% wind deductible should you have a claim.
They may also charge something called an underwriting fee which can be up around the $500 mark. USF&G charged $750.00 as a Policy Handling Fee.
If you are covered or can only get a surplus line carrier you are eligible for Citizens because they are not Florida based companies.
One advantage of Surplus Lines Carriers is that they do not insist on "Four Point Inspection" like Citizens Insurance will.
You will find little information from the State about surplus line carriers. Even though the OIR does not regulate Surplus Line Insurance, it does list the carriers.