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Last updated on September 15, 2025

Florida Commercial Property Insurance: Protecting Your Business Assets

Samantha Johnson
Author
Samantha Johnson
— Car insurance specialist
Samantha Johnson is a licensed insurance agent with more than 10 years of experience guiding clients through the process of securing affordable and reliable coverage. She specializes in auto, renters, and home insurance, with a reputation for simplifying complex policies and tailoring solutions to meet each client’s needs. Samantha is passionate about educating clients and empowering them to make informed decisions about their financial protection.
Based in Florida, Samantha contributes regularly to online sites, where she shares her unique insights on saving money, understanding local insurance requirements, and gives invaluable tips on how to save more money when purchasing an insurance policy. Outside of her professional work, she enjoys painting, spending time at the beach, and caring for her dog Spike.
Last updated on July 10, 2025

 

Florida Specialty Insurance Company (FSIC), once a provider of non-admitted insurance, commercial property, and auto lines, ceased operations in 2019.1 The Florida Office of Insurance Regulation mandated its liquidation, appointing KPMG LLP as receiver to manage assets and liabilities.2 This event underscored the challenges within Florida’s insurance market, prompting regulatory changes and impacting policyholders seeking coverage. Understanding the history and implications of FSIC’s closure offers valuable insights for navigating the current insurance landscape and securing reliable protection for your commercial property.

  • FSIC’s liquidation highlights the importance of financial stability in insurers.
  • Policyholders experienced disruptions and the need to find alternative coverage.

FSIC’s Operational History

Headquartered in Jacksonville, FSIC operated as a surplus lines insurer.3 Despite acquiring companies like Liberty National Life Insurance Company, FSIC faced mounting financial difficulties.4 By mid-2018, its liabilities significantly outweighed its assets, rendering it unable to fulfill claims obligations. This precarious financial position ultimately led to the regulatory intervention and subsequent liquidation.

  1. FSIC actively engaged in acquisitions, impacting its financial stability.
  2. Mounting liabilities and dwindling assets led to claim payment failures.

Reasons for Liquidation

The Florida Office of Insurance Regulation’s decision to liquidate FSIC stemmed from the company’s inability to honor claims. 6 This failure triggered a cascade of events, impacting policyholders and necessitating intervention by the Florida Insurance Guaranty Association (FIGA).7 The regulatory action underscores the importance of diligent oversight and consumer protection within the insurance industry.

FSIC Financial Snapshot (Mid-2018) 1
Category Amount (USD)
Assets $13.7 million
Liabilities $311.6 million

Impact of New Regulations

FSIC’s liquidation prompted new insurance regulations in Florida, including a lowered cap on annual rehabilitation assessments for non-admitted insurers and increased minimum cash reserve requirements.2 These changes aimed to enhance financial stability and protect policyholders. The implementation of these measures reflects the state’s commitment to a more robust and secure insurance environment. For those exploring insurance options, understanding these regulations can empower informed decision-making.

  • New cap limits financial strain on non-admitted insurers.
  • Higher reserves enhance insurers’ capacity to pay claims.

Policyholder Repercussions

FSIC’s liquidation directly impacted policyholders, leading to the activation of FIGA to manage claims and refunds. Policyholders faced a statutory deduction from refunds and potential delays based on claim amounts.8 This process highlighted the role of guaranty associations in mitigating losses for policyholders when insurers become insolvent. The challenges faced by FSIC policyholders underscore the importance of understanding insurance policies and regulatory protections.

  1. FIGA facilitated claims processing and refunds.
  2. Policyholders faced deductions and potential processing delays.

Navigating the Current Landscape

The FSIC case emphasizes the need for thorough research and due diligence when selecting commercial property insurance.9 Evaluating an insurer’s financial strength, reputation, and customer service is crucial for securing reliable coverage.10 Understanding policy details, coverage limits, and claims procedures is paramount to ensuring adequate protection for your business assets.

Key Considerations When Choosing Commercial Property Insurance 3
Factor Description
Financial Strength Assess the insurer’s ability to pay claims.
Coverage Options Evaluate coverage types and limits for your specific needs.
Claims Process Understand the procedures and expected timelines for claims.

Protecting Your Business

Given Florida’s susceptibility to natural disasters, ensuring comprehensive coverage for your commercial property is essential.11 Consider factors like windstorm, flood, and earthquake risks when evaluating policies. Consulting with an insurance professional can help you identify potential vulnerabilities and tailor coverage accordingly. Proactive risk management and a thorough understanding of your insurance policy can contribute significantly to safeguarding your business.

  • Assess property-specific risks, including natural disasters.
  • Seek expert advice for customized coverage solutions.

Frequently Asked Questions

Q. What recourse did policyholders have after FSIC’s liquidation?

A. Policyholders could file claims with FIGA for reimbursement of unearned premiums, subject to certain deductions and procedures.

Q. How do I evaluate the financial stability of an insurance company?

A. Consult independent rating agencies like A.M. Best and review financial statements to assess an insurer’s financial health.12

Q. What types of coverage should I consider for my Florida commercial property?

A. Essential coverage often includes property damage, business interruption, and liability protection, tailored to your specific risks.13

Q. How can I mitigate risks to my business in Florida’s high-risk environment?

A. Implement disaster preparedness measures, secure adequate insurance coverage, and consult with risk management professionals.

Conclusion

The Florida Specialty Insurance Company’s liquidation serves as a crucial reminder for businesses to prioritize due diligence when selecting insurance providers. Protecting your commercial property requires a comprehensive understanding of potential risks, appropriate coverage, and the financial strength of your chosen insurer. Don’t wait until it’s too late—take proactive steps to safeguard your business today. Explore your options and compare quotes to find the right coverage for your needs. Get started now.

References

  1. https://www.insurancejournal.com/
  2. https://content.naic.org/
  3. https://www.investopedia.com/terms/c/commercial-property-insurance.asp
  4. https://www.propertycasualty360.com/
  5. https://www.floridadisaster.org/hazards/hurricanes/
  6. https://www.forbes.com/advisor/business-insurance/commercial-property-insurance/
  7. https://web.ambest.com
  8. https://www.sfwmd.gov/
  9. https://www.demotech.com/
  10. https://www.moodys.com/

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