FIGA Accelerates Elimination of 1% Assessment for Insolvent Insurer Claims by Two Years
Remember the stormy days of March 2023, when the Florida Insurance Guaranty Association (FIGA) voted to implement a 1% emergency assessment on all homeowners’ and commercial policies? This decision was made to help cover outstanding claims left behind by insolvent insurers.
Fast forward three years, and FIGA has announced it will end the surcharge two years earlier than anticipated. This positive development is attributed to a relatively quiet hurricane season in 2025, the absence of further insurer insolvencies, a cap on excessive claims litigation, and a significantly improved insurance market in Florida. According to FIGA Executive Director Bob Ricker, this move will save policyholders in the state up to $650 million over the next two years, as detailed in a recent bulletin.
Over the past five years, FIGA has paid more than $2.1 billion in claims to Florida policyholders, providing much-needed relief to those with unpaid claims. Ricker emphasized the importance of this support, stating, “bringing relief to Floridians with unpaid claims” has been a priority.
The assessment on most property-casualty insurance policies was introduced in 2023 to help cover bond issues necessary for addressing the surge in unpaid claims. This charge followed previous assessments of 0.7%, 1.3%, and 0.7%, as many Florida insurers faced challenges due to what was termed runaway and disingenuous levels of claims litigation.
The 1% emergency assessment is set to officially terminate on October 1.
The conclusion of this assessment marks another milestone in the ongoing impact of the legislative reforms enacted in late 2022 and 2023. These reforms, which included the repeal of one-way attorney fees and assignment-of-benefit agreements, have begun to yield the positive results that industry officials had hoped for.
Florida Insurance Commissioner Michael Yaworsky stated, “The historic reforms by the Florida Legislature in 2022 continue to reverberate through the market, and ending this assessment two years early is yet another indicator that the insurance market has stabilized and is producing savings for consumers.”
Established by Florida lawmakers in 1970, FIGA serves as a safety net for policyholders with claims pending against property-casualty insurers that are unable to fulfill their obligations. The organization is authorized to utilize the remaining assets of insolvent insurers, as well as surcharges on policies, to meet these claims.
In early 2024, Florida’s governor proposed a state budget that would have suspended the FIGA assessment as part of a relief package for property owners. However, the suspension was deemed too complicated due to the obligations owed to bondholders.
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Remember the stormy days of March 2023, when the Florida Insurance Guaranty Association (FIGA) voted to implement a 1% emergency assessment on all homeowners’ and commercial policies? This decision was made to help cover outstanding claims left behind by insolvent insurers.
Fast forward three years, and FIGA has announced it will end the surcharge two years earlier than anticipated. This positive development is attributed to a relatively quiet hurricane season in 2025, the absence of further insurer insolvencies, a cap on excessive claims litigation, and a significantly improved insurance market in Florida. According to FIGA Executive Director Bob Ricker, this move will save policyholders in the state up to $650 million over the next two years, as detailed in a recent bulletin.
Over the past five years, FIGA has paid more than $2.1 billion in claims to Florida policyholders, providing much-needed relief to those with unpaid claims. Ricker emphasized the importance of this support, stating, “bringing relief to Floridians with unpaid claims” has been a priority.
The assessment on most property-casualty insurance policies was introduced in 2023 to help cover bond issues necessary for addressing the surge in unpaid claims. This charge followed previous assessments of 0.7%, 1.3%, and 0.7%, as many Florida insurers faced challenges due to what was termed runaway and disingenuous levels of claims litigation.
The 1% emergency assessment is set to officially terminate on October 1.
The conclusion of this assessment marks another milestone in the ongoing impact of the legislative reforms enacted in late 2022 and 2023. These reforms, which included the repeal of one-way attorney fees and assignment-of-benefit agreements, have begun to yield the positive results that industry officials had hoped for.
Florida Insurance Commissioner Michael Yaworsky stated, “The historic reforms by the Florida Legislature in 2022 continue to reverberate through the market, and ending this assessment two years early is yet another indicator that the insurance market has stabilized and is producing savings for consumers.”
Established by Florida lawmakers in 1970, FIGA serves as a safety net for policyholders with claims pending against property-casualty insurers that are unable to fulfill their obligations. The organization is authorized to utilize the remaining assets of insolvent insurers, as well as surcharges on policies, to meet these claims.
In early 2024, Florida’s governor proposed a state budget that would have suspended the FIGA assessment as part of a relief package for property owners. However, the suspension was deemed too complicated due to the obligations owed to bondholders.
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