Florida's Citizens Property Insurance no longer state's largest insurer

Florida's Citizens Property Insurance is no longer the largest insurance company in the state after shedding nearly 200,000 policies in October alone through its "depopulation process."

"It's good news for everyone," said Michael Peltier, a spokesperson for Citizens Property Insurance. "As Florida is the insurer of last resort, historically, when the market is facing challenges, Citizens policy count goes up. When the market gets healthy, then our numbers go down. And that's what we're seeing here."

The state-backed insurer of last resort has been transferring tens of thousands of policies to private companies to reduce risk, bringing its total policy count to 568,914 as of Oct. 31st. That puts Citizens behind State Farm, which now holds the top spot with about 646,429 policies as of August, according to data from the Office of Insurance regulation.

WATCH: Florida's Citizens Property Insurance no longer state's largest insurer

Citizens officials say this shift signals a recovering insurance market where more private companies are willing to write policies in Florida.

"The October depopulation about 199,000 were transferred to private companies. What I think is encouraging too, is that about 40% of those policies, the take out premium was actually less than what the Citizens premium was. So consumers are seeing more choices on the market," Peltier added. "We've seen about 17 new companies come in the last few years. So it's really important for customers to talk to their agent and see what their options are, because, you know, they very well, may be able to find more comprehensive policies at premiums that are lower than what they're paying now."

What to Do If You Get a Takeout Letter

Nearly 200,000 people received takeout letters last month notifying them they were being dropped by Citizens and transferred to the private market.

If you receive a takeout offer from another company within 20% of what you're paying Citizens, you're required to accept it. If the offer is higher, you can choose to stay with Citizens, but you must notify the company of your decision.

Insurance agent Jake Holehouse, with HH Insurance Group, recommends calling your agent immediately if you receive one of these letters, as some private companies may offer comparable rates but with different coverage levels.

"One of the concerns that I do have on that is some carriers are offering less coverage than what's available on the Citizens policy," Holehouse said. "So if you have a $50,000 pipe break claim, Citizens covers $50,000 of damage, but some of the takeout carriers only cover $10,000 worth of damage, or they can put provisions on to diminish the value of a roof over the years."

Holehouse also suggests using takeout letters as an opportunity to shop your policy around, as the market is becoming more competitive and rates are dropping.

"For the past couple years, you know, insurers would get a offer to move from Citizens into the private marketplace, and they would only get one offer, and it would be at a rate many times higher than Citizens," Holehouse said. "We now have insureds that just went through the takeout round that had four competing offers of four different carriers with rates that are not competing for business."

For more information on the Citizens' depopulation process and resources, click here.