Recent Florida Supreme Court decisions and ongoing abuse in Florida’s insurance market have led a ratings company to change the criteria it uses when rating insurers in the state. The announcement comes as insurers get ready to announce their 2016 annual reports that could indicate unfavorable results for many.
Ohio-based Demotech — which rates 397 companies nationwide, 57 of which are in Florida —said Monday that it has suspended ratings guidelines it uses in Florida due to what it is calling an uncertain operating environment in the state.
The ratings firm says no Florida insurers it rates are in danger of failing but there are about 10 to 15 that could see downgrades in March.
Demotech said it will eventually revise its general guidance but, in the meantime, it is advising carriers individually to ensure they are adequately capitalized to handle the now uncertain operating environment.