TAMPA - On October 1, 2012, homeowners who insure through Citizens Property Insurance Corporation may get a letter in the mail informing you that your policy has been bought out.
Those customers will have 30 days to decide to stay with Citizens. Unless they receive a response, the company will assume the homeowner agrees to the change. Those policies will then be handled by one of the private insurance companies beginning November 6.
Ester Ober and Alexandra Gomez find the news a little unsettling.
Ober's mother, Gomez's grandmother is a Citizen's policy holder and has been for years.
Gomez said, "She is an older lady, she has a bit of a language barrier. So getting that letter and knowing that there is going to be a change, it might be difficult for her to understand."
A decision by the Florida Office of Insurance Regulation will affect nearly one fifth of the 1.4 million policy holders of the state run insurer.
On Monday, the state approved the removal of 60,000 additional policies. Now a total of 210,000 policies will be assumed by other independent insurance companies.
The state insurance commissioner, Kevin McCarty, said, "One of the office's goals is to continue to support a competitive property insurance market."
Christine Ashburn with Citizens Insurance said, "We are excited about the growing interest by Florida Insurance companies by looking at and taking on Citizen policies."
Bill Newton, executive director of non-profit watchdog organization Consumer Action Network said this could be a positive. But he urges people to check the mail and read the fine print.
"When consumers receive these take-out notices, they need to check first of all and look at the product and the price and see if it is better than Citizens. Is it really a lower price? And if it is not a lower price and you are happy with Citizens, just stay with Citizens," said Newton.
According to the state, homeowners will have 30 days to accept or decline and if they don't respond, they will automatically transferred to one of the new private insurance companies.
"Here's the downside: In the past, not these particular insurance companies, but other companies that have taken people out of Citizens, they cherry-pick. They take the best customers and they throw the rest back," said Newton.
Those who will be affected has not yet been determined. And, Citizens says if you do choose one of the private companies, the transfer will be seamless.
Also, they say premium will not change. At least not until the policy comes up for renewal. At that point you'll pay whatever rate the state has set for that particular company.
That's why Gomez will keep a close eye on the mail for her grandmother.
"If she gets the new insurance and it does renew and there is an increase in price, she has Social Security, but it's not a lot. It could be difficult for her," said Gomez.
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