Florida Citizens Commercial Clearinghouse Faces Cost and Approval Delays
Citizens’ commercial policy clearinghouse is stalled as board members question its cost and required documents remain outstanding ahead of a January deadline.
Florida Citizens Property Insurance’s plan to create a commercial policy clearinghouse faces two obstacles: its board has questioned whether the proposal is affordable, and the Office of Insurance Regulation says it lacks the materials needed to review the program. With a January deadline approaching, the timing of both issues puts the proposed launch in doubt.
Cost questions put the plan back under review
At a late September meeting of Citizens’ Board of Governors, Chairman Carlos Beruff said the figures and implementation plan did not make sense to him. He said the board would return to the drawing board before bringing forward a proposal it could afford, with the aim of avoiding further cost increases for policyholders.
That statement signals that the program’s design and expense remain unsettled at the board level. The source does not provide a proposed budget, a cost breakdown or an estimate of how much the clearinghouse would add to policyholder costs. It also does not specify which parts of the implementation plan prompted the chairman’s concerns. For brokers and agents, the practical question is whether Citizens can produce a workable plan quickly enough to satisfy both its board and the review process.
Required documents are still missing
A week before Beruff’s comments, Deputy Insurance Commissioner Jane Nelson wrote to Citizens’ general counsel about the steps required before the clearinghouses can be established. Senate Bill 1028, signed in June, requires Citizens to amend its Plan of Operation—the document that sets out how the insurer is run—before setting up the program.
Nelson’s letter said Citizens had not submitted all the materials needed for the office’s review. The missing pieces included the Plan of Operation amendment establishing the clearinghouse program and contracts with the administrators. The office had also asked Citizens to address deficiencies in the information it had received, but had not yet received satisfactory responses.
As a result, the office said it could not approve the program at that time. That status matters because review must happen before the clearinghouses can be set up. Even if Citizens settles the costs and design questions raised by its board, it still needs to provide the required documents and address the outstanding information requests.
A contract is being finalized, but approval remains separate
Citizens is working to finalize a contract with the winning bidder, a subsidiary of Brown & Brown, to administer one of the commercial clearinghouses required by the new law. The platform is intended to help brokers and insurance agents move more Citizens commercial policies to surplus lines insurers.
The contract is one part of the process, rather than evidence that the program is ready to operate. The review office identified both the administrator contracts and the Plan of Operation amendment as documents it still needed. Finalizing an administrator agreement would therefore address only part of the stated documentation gap; the office would still need the other required materials and satisfactory responses to its requests.
The intended role of the platform is to create a route for placing more commercial policies with surplus lines insurers. The source does not specify which policies would qualify, how a broker would use the system, or what terms a business would receive through a placement. Those details should not be assumed from the clearinghouse’s stated purpose alone.
The January deadline leaves little room for delay
The effort is running short on time before a January deadline set by Florida statute. The source does not identify the precise January date, and it does not say what would happen if Citizens missed it. It does, however, make clear that board concerns, incomplete submissions and the need for review are all unresolved as the deadline approaches.
Some sources quoted in the report speculated that the September letter from Nelson and Insurance Commissioner Michael Yaworsky could give Citizens a way to delay or abandon the plan without a formal confrontation. That is speculation, not a stated decision by Citizens or the review office. The letter itself describes the information needed to complete review and says approval is not possible while those materials and satisfactory responses remain outstanding.
For commercial policyholders and their agents, the immediate takeaway is that the proposed clearinghouse is not yet approved or operating. Citizens must settle the program’s design and affordability questions, complete the administrator arrangements, amend its Plan of Operation and provide the information requested for review. Until those steps are completed, the proposed route for moving more Citizens commercial policies to surplus lines remains a plan under development.
The next developments to watch are whether Citizens brings a revised proposal to its board, submits the outstanding materials and completes the administrator contract. Those steps will show whether the January deadline can still be met and whether the clearinghouse advances beyond its current planning stage.
