The Citizens Exit Guide: What to Do When a Private Carrier Takes Out Your Policy
By Ricardo Alonso, Founder, Atesa Risk Advisors · March 25, 2026 · Updated November 3, 2026
Key Takeaways
- If a private carrier offers you a premium that is not more than 20% above your Citizens renewal premium, Florida law makes you ineligible to stay with Citizens. You must accept an offer or find another private option [1][2].
- Citizens has shrunk from a month-end peak of 1,407,805 policies on September 30, 2023 to 255,099 on September 18, 2026, so your letter is not unusual [3].
- If no choice is registered by the date on your Offer Form, Citizens assigns your policy to the company with the lowest premium offer, and the transfer is final [2].
- You can vet any takeout carrier in about 15 minutes using Demotech ratings and the Florida OIR website [4][5].
- Staying with Citizens requires flood insurance on every personal residential policy with wind coverage effective on or after January 1, 2027, except condo unit-owner policies [1].
If you received a Citizens depopulation letter, a state-approved private insurer has asked to take over your policy. Compare each takeout offer with your Citizens renewal premium, vet the company, and register your choice by the date on your Offer Form. An offer not more than 20% above the Citizens premium ends your eligibility to stay. The rule is in section 627.351(6) of the Florida Statutes [1]. You still have options, and this guide walks you through every one of them.
Why You Received the "Depopulation" Packet
If you are holding a thick envelope from Citizens Property Insurance with the word "depopulation" on it, take a breath. You are not being dropped, canceled, or left without coverage. What is happening is part of a deliberate, state-mandated program to move policyholders out of Florida's insurer of last resort and back into the private market.
Citizens was never designed to be a permanent home for Florida homeowners. The Florida Legislature created it in 2002 as a safety net for people who genuinely could not find coverage elsewhere [6]. At its month-end peak on September 30, 2023, Citizens held 1,407,805 policies, far more than intended. As of September 18, 2026, it holds 255,099 [3]. In 2025 alone, over 585,000 policies were transferred to private insurers, removing $235.6 billion in exposure from the state-backed insurer, and another 131,144 followed in 2026 through September 22 [7].
This massive shift followed the property insurance law of December 2022 (Senate Bill 2-A), which created the 20% renewal rule described below [8]. Citizens counts 20 new companies in the state since 2022 [9]. The market is stabilizing, and that is why your letter arrived.
One of our longtime clients (Silvia) reached out to us recently after receiving her second depopulation notice in three months. She was upset. The first depopulation notice ended in the other company not taking her policy leaving her in limbo. This second one we shopped her insurance around and found an alternate price entirely avoiding the depopulation mess entirely.
The 20% Rule Explained: Can You Stay with Citizens?
This is the number that decides your options in the depopulation packet. Florida law establishes what is commonly called the "20% rule," and it determines whether you have a choice or not [1].
Here is how it works. Citizens estimates what your renewal premium would be. Each private carrier that selected your policy submits its own estimated renewal premium. If an offer is at or below 120% of your Citizens renewal premium, your policy is no longer eligible to remain with Citizens. You do not get to opt out [2].
The statute applies the same 20% test to takeout offers, renewals and new applications on primary residences, and to commercial residential policies such as a condo association's [1]. For a home that is not a primary residence, the 2024 depopulation expansion (HB 1503) made offers from approved surplus lines insurers, carriers outside Florida's standard licensed market, count as well [10]. A primary residence is a home the owner or a tenant occupies for more than 9 months of the year [1].
For example, if your Citizens renewal premium would be $3,000, and the private carrier offers you $3,500, that offer is within 20% ($3,600 would be the threshold). You would be required to accept the private carrier — or find a different private carrier on your own. You cannot stay with Citizens.
If every offer exceeds 120% of your Citizens premium, you have the right to opt out and remain with Citizens. But you must register that choice by the date printed on your "Offer Form," through your agent or online with the registration code on the form. If no choice is registered, Citizens assigns your policy to the company that offered the lowest premium, regardless of the price difference. There is no 30-day window to return: once the assumption occurs, the transfer is final [2].
The bottom line: Open your packet, find the premium comparison page, and do the math. If the offer is within 20%, start evaluating the new carrier. If it is above 20%, you can decline — but you still might want to consider the private option if the coverage is better.
Is Your New Company Stable? How to Vet 2026 Takeout Carriers
This is where most homeowners feel the most anxiety. You have heard the stories — Florida insurance companies going insolvent, leaving policyholders scrambling. Between April 2021 and February 2023, eight Florida property insurers were ordered into liquidation [11]. So how do you know if the company in your depopulation packet is solid?
The good news is that every carrier participating in the depopulation program has been approved by the Florida Office of Insurance Regulation (OIR) [5]. But "approved" and "financially strong" are not the same thing. Here is how to check for yourself.
Checking Financial Stability: Demotech vs. AM Best
Many Florida-focused property insurers are rated by Demotech, a rating firm less widely known than AM Best. Its Financial Stability Ratings (FSRs) run from A Double Prime and A Prime (both Unsurpassed) through A (Exceptional), S (Substantial) and M (Moderate) down to L (Licensed). Look for a rating of "A" (Exceptional) or higher [4].
Four carriers with 2026 takeout approvals, as listed by Demotech on September 27, 2026 [4] and by OIR [5]:
| Carrier | Demotech FSR | Latest OIR takeout approval listed |
|---|---|---|
| Slide Insurance Company | A (Exceptional) | June 15, 2026, for September 2026 assumptions |
| American Integrity Insurance Company | A (Exceptional) | July 17, 2026, for October to December 2026 assumptions |
| Manatee Insurance Exchange | A (Exceptional) | March 16, 2026, for June to September 2026 assumptions |
| Southern Oak Insurance Company | A (Exceptional) | July 17, 2026, for October to December 2026 assumptions |
Ratings change, so repeat the lookup on the day you decide. OIR issues each takeout approval as a consent order, so a consent order under a carrier's name may simply be that approval [5].
Several carriers on OIR's takeout list are "reciprocal exchanges," among them Praxis Reciprocal Exchange [5] and Manatee Insurance Exchange, which OIR's 2024 list of new entities shows as a reciprocal [12]. Florida law defines a reciprocal insurer as an unincorporated group of subscribers (the policyholders) who insure one another through a manager called an attorney in fact [13]. This is not inherently bad, but it is different from a traditional stock or mutual insurance company, and you should understand the structure before committing.
The 3-Step "Solvency Search" Checklist
You can vet any carrier in about 15 minutes:
| Step | What to Do | Why It Matters | Time |
|---|---|---|---|
| 1. Check the Demotech Rating | Visit demotech.com and search for the carrier name. Look for an FSR of "A" (Exceptional) or higher. | Demotech expects at least 97% of insurers rated A to have positive surplus 18 months after the rating is assigned [4]. | 5 minutes |
| 2. Search Florida OIR for Consent Orders | Visit floir.gov/resources-and-reports/orders-and-memoranda and search for the carrier name. | A takeout approval is itself a consent order [5]. Read any other order under the carrier's name to see what the state required. | 5 minutes |
| 3. Check the NAIC Complaint Index | Visit the NAIC Consumer Insurance Search and look up the carrier's complaint index. | The index measures complaints relative to the size of the company, which gives a sense of how well an insurer serves its customers [14]. | 5 minutes |
What Is Changing in 2026: Market Trends Affecting Your Decision
The Florida property insurance market in 2026 looks dramatically different from even two years ago, and these changes directly affect whether staying with Citizens or moving to a private carrier makes more sense for you.
The Market Is Cooling — In Your Favor. The December 2022 law eliminated one-way attorney fees in property insurance lawsuits and barred assignment of benefits (AOB), the signing over of claim rights to a contractor, on policies issued on or after January 1, 2023 [8]. The result has been significant: Citizens itself reduced rates for homeowners multiperil policies by an average of 8.8%, effective July 1, 2026 for new policies and at renewal for existing ones [6]. This means the private offer in your packet may actually be competitive — or even cheaper than Citizens.
Climate Risk Is Still the Wild Card. Despite the improving market, Florida remains the most hurricane-exposed state in the country. If you live in a coastal or flood-prone area, your private carrier options may be limited, and the ones available may carry higher hurricane deductibles than what Citizens offers.
Assessment Risk Favors the Private Market. Here is something many homeowners overlook: if Citizens does not have enough money to pay claims after a catastrophic hurricane season, it must levy a Citizens Policyholder Surcharge of up to 15% of premium on its own policyholders [15]. Emergency assessments of up to 10% a year can follow, but those fall on Citizens and private-market policyholders alike [15]. This alone can tip the math in favor of accepting a private carrier, even if the premium is slightly higher.
Staying with Citizens Now Requires Flood Insurance. State law makes flood coverage a condition of a Citizens personal residential policy that includes wind coverage [1]:
| Citizens policy | Flood coverage required for policies effective on or after |
|---|---|
| In a special flood hazard area | April 1, 2023 (new policies); July 1, 2023 (renewals) |
| Dwelling replacement cost of $600,000 or more | January 1, 2024 |
| $500,000 or more | January 1, 2025 |
| $400,000 or more | January 1, 2026 |
| All other personal residential policies | January 1, 2027 |
Condo unit-owner policies and policies without wind coverage are exempt [1]. If you are eligible to stay, add the cost of a flood policy to the Citizens side of the comparison.
How to Make Your Decision: A Step-by-Step Guide
Once you have your depopulation packet open and your carrier vetted, here is the decision process:
Step 1: Compare the premiums. Find the Citizens estimated renewal premium and each private carrier's estimated renewal premium on the Offer Form in your packet [2]. Calculate whether the offer is within 20%.
Step 2: Compare the coverage — not just the price. Citizens itself says that in many cases the coverage offered may be more comprehensive than what it provides [2]. Use the Coverage Worksheets in your packet to compare items such as water backup, hurricane deductibles and liability limits.
Step 3: Factor in the assessment risk. Remember that Citizens policyholders face a surcharge of up to 15% of premium after a catastrophic storm. Private-market policyholders do not pay that surcharge [15].
Step 4: Talk to an independent agent. A captive agent works for one company. An independent agent — like Atesa Risk Advisors — works for you. We can compare the takeout offer against quotes from 40+ A-rated carriers to make sure you are not leaving money or coverage on the table.
Questions to ask your insurance agent:
- "Is this takeout carrier financially stable, and what is their Demotech rating?"
- "What coverages does the private policy include that Citizens does not — and vice versa?"
- "Can you shop this against other carriers to see if there is a better option than the takeout offer?"
Frequently Asked Questions
Q: What happens if I ignore the Citizens depopulation letter?
A: If no choice is registered by the date on your Offer Form, Citizens assigns your policy to the private carrier that offered the lowest premium, whether or not you were eligible to stay [2]. You will not lose coverage, but the transfer is final once the assumption occurs. Always open and respond to the letter.
Q: Can I go back to Citizens after being moved to a private carrier?
A: Only as a new applicant. Citizens no longer allows a 30-day return period, so once the assumption occurs the transfer is final [2]. A new application is not eligible if an authorized insurer offers comparable coverage at a premium that is not more than 20% greater than the Citizens premium [1].
Q: How do I calculate whether the offer is within 20% of my Citizens premium?
A: Find your estimated Citizens renewal premium on the Offer Form in your packet and multiply it by 1.20. For example: $2,500 Citizens premium x 1.20 = $3,000 threshold. Any offer at $3,000 or below means you cannot remain with Citizens [1].
Q: What is a reciprocal exchange, and should I be worried about one taking over my policy?
A: A reciprocal exchange is a type of insurer where the policyholders, called subscribers, insure one another through a manager known as an "attorney in fact" [13]. Florida law recognizes this structure. The key is to check the exchange's Demotech rating and its OIR approval, just as you would with any traditional carrier.
Q: Does the depopulation program apply to condo and commercial policies too?
A: Yes. Citizens runs separate depopulation programs for personal lines and commercial lines, and the same 20% rule applies to commercial residential policies such as condo association master policies [1]. Commercial nonresidential policies cannot elect to remain with Citizens once they receive an offer [2].
Q: Will my coverage change when I move to a private carrier?
A: It can, and this is exactly why you need to compare the full Coverage Worksheets, not just the premium. By law, an assumed policy stays on Citizens' policy form through the end of the policy term, so any differences arrive when the new company renews it [1]. An independent agent can do a side-by-side comparison for you.
Related Reading
- Citizens Commercial-Residential in 2026: The Florida Condo Board's Guide to Takeout Offers — the association-side version of this decision: the same 20% rule applied to your building's master policy.
- Citizens Insurance Rate Decrease 2026: What the Cut Actually Means at Your Renewal — the approved 2026 cuts by policy form, why your renewal shows a different number, and the FIGA line item ending October 1.
- Florida Homeowners Insurance Non-Renewal: Your 120-Day Replacement Playbook (2026) — the 120-day runway, what the notice must state, and the week-by-week replacement sequence across admitted carriers, surplus lines and Citizens.
- Lender-Placed Insurance in Florida (2026): Why It Costs More, Covers Less, and How to Get Out of It in a Week — the other way a carrier change happens without your say-so, and the federal clock that reverses it.
How Atesa Risk Advisors Can Help
Receiving a depopulation letter can feel overwhelming, but it does not have to be. As an independent insurance agency with access to 40+ A-rated carriers, we help you find the best private-market coverage for your home at a competitive price.
We are a RamseyTrusted Pro agency. Our founder, Ricardo Alonso, started his career in construction and development, so we understand Florida properties from the ground up. We will review your depopulation packet, vet the takeout carrier, compare it against the broader market, and make sure you do not miss your response deadline.
Got a depopulation letter sitting on your kitchen counter? Get your free quote and consultation at atesariskadvisors.com/get-quote or call (904) 900-5063.
Sources
[1] Florida Statutes, section 627.351(6): Citizens Property Insurance Corporation
[2] Citizens Property Insurance Corporation: Personal Lines Depopulation Program
[3] Citizens Property Insurance Corporation: Policies in Force
[4] Demotech: Financial Stability Ratings definitions and company search
[5] Florida Office of Insurance Regulation: Take-Out Companies
[7] Citizens Property Insurance Corporation: Exposure Removed 2014-2026
[8] The Florida Senate: Bill Summary, SB 2-A (2022 Special Session A)
[10] The Florida Senate: Bill Summary, CS/CS/HB 1503 (2024)
[11] Florida Department of Financial Services: Companies in Receivership
[12] Florida Office of Insurance Regulation: New Entities to the Florida Insurance Market, 2024
[13] Florida Statutes, section 629.011: Reciprocal insurers, definitions
[14] NAIC: A Consumer's Guide to Home Insurance
[15] Citizens Property Insurance Corporation: Assessments
Ricardo Alonso is the Founder of Atesa Risk Advisors, a Jacksonville-based independent insurance agency. Licensed 2-20 General Lines Agent and 2-15 Health & Life Agent with a Master of Liberal Arts in Finance from Harvard University. Ricardo's background in construction and development gives him a unique understanding of Florida property risks and the coverage homeowners need to protect their investment.