News Service of Florida reported that the Florida Department of Financial Services will liquidate St. Johns and that the agency is seeking court approval of a “transition plan” that would transfer St. Johns policies to another insurance company. Insurance, Slide Insurance Company.
Dempsey’s order came two days after Florida Insurance Commissioner David Altmaier sent a letter to state chief financial officer Jimmy Patronis saying St. Johns had agreed to the receivership and acknowledged its insolvency.
“The referral of this company by the [Department of Financial Services’] The Rehabilitation and Liquidation Division is the first step in a comprehensive plan to ensure a seamless transition for all St. Johns Insurance Company policyholders,” Altmaier said in his letter.
Altmaier’s letter did not disclose how many fonts would be affected by the receivership. But according to information on the St. Johns Insurance website, the company sold home insurance policies in Florida and South Carolina. St. Johns had also informed insurance agents that it would suspend underwriting of new business on February 15, 2022.
The district court order will trigger a process in which the Florida Insurance Guaranty Association and the South Carolina Property and Casualty Insurance Guaranty Association will pay St. Johns’ outstanding claims.
Read more: Coverage gradually declining for 56,000 homes in Florida
The insolvency of St. Johns Insurance is just the latest bump in Florida’s rocky property insurance market. Last month, Progressive announced it was cutting coverage for 56,000 homes in Florida, citing rising claims and litigation costs in the state.
Read more: Liquidation of Gulfstream Property & Casualty forces 33,000 policyholders to find alternative cover
Meanwhile, in August insurer Gulfstream Property & Casualty went into liquidation after being placed under the administrative supervision of Florida’s Office of Insurance Regulation. It was determined that Gulfstream was financially unable to pay claims or issue refunds worth between $60 million and $65 million.