Progressive Dropping 100K Home, Landlord Policies in Florida

Beginning in late December, Progressive will start sending non-renewal notices to 100,000 Florida policyholders who have landlord or homeowners insurance through Progressive. The company also said it will no longer insure non-owner-occupied properties.

Policyholders who receive a non-renewal notice have until May 2024 to find replacement coverage. Progressive said it’s struck a deal with Loggerhead Reciprocal Interinsurance Exchange to offer replacement policies to affected policyholders.

Affected policies

In an email sent to insurance agents on Sept. 29, 2023, Progressive said it will no longer provide dwelling and fire coverage policies, known as DP-3 policies, in Florida for landlords and investors. The company will insure only owner-occupied properties going forward.

Progressive will also not renew certain high-risk homeowners policies, the company said.

The move will eliminate 47,000 DP-3 policies and 53,000 high-risk property policies from the insurer’s book of business in Florida, the Insurance Information Institute (Triple-I) told multiple Florida media outlets.

Progressive also said it will discontinue its relationship with “select agents” in Florida.

How this impacts all Florida homeowners

“Progressive’s decision to non-renew approximately 115,000 residential policies in Florida will create more disruption in the state’s volatile home insurance market,” says Mark Friedlander, director of corporate communications for Triple-I. “This follows a trend of several national and regional insurers reducing their risk in Florida over the past year through either non-renewals or voluntary market withdrawals.”

The shrinking number of options means it’s more difficult for Floridians to find affordable home insurance coverage.

Florida homeowners face the highest annual average insurance rates in the country — $7,788, Insurify data shows. By comparison, the national average cost is $1,784 per year.

Reasons behind the move

Florida’s exposure to damage from extreme weather is only one reason insurers are pulling back from the state.

“Floridians are seeing homeowners insurance become costlier and scarcer because, for years, the state has been the home of too much litigation and too many fraudulent roof-replacement schemes,” Triple-I CEO Sean Kevelighan said in a recent brief. Although Florida represents less than 10% of home insurance claims nationally, it accounts for 79% of homeowners insurance lawsuits, Triple-I reported.

Progressive emphasized in its statement that it isn’t leaving the Florida market altogether. But, the insurer said, it’s taking action to “ensure our long-term future in the state.”

“Florida represents (about) 6.5% of all single-family dwellings in the U.S., but more than 17% of all homes insured by Progressive Home are located there,” the insurer said. “We need to take steps to find the right balance for our overall property insurance portfolio.

What to do next

Since Progressive won’t start sending non-renewal notices until late December, many homeowners won’t know yet if this latest move affects them. But homeowners can shop for insurance at any time.

Alternatively, they can wait to receive a notice and then explore what rates Loggerhead might offer them. The Tampa startup struck an agreement with Progressive to offer coverage to affected homeowners, Friedlander said.

And “former Progressive policyholders will also have the opportunity to shop for coverage with five newly approved insurers expected to start writing in [Florida] in early 2024,” he said.