During the last two years, Citizens staff has presented multiple changes to Actuarial and Underwriting Committee and the Board of Governors to address the rapidly rising claims costs due to water losses and associated litigation.


At its December 2015 meeting, Citizens Board of Governors approved a recommendation from staff to modify policy language. Changes included:


• Limit coverage for cost of Reasonable Emergency Measures that are required by contract to the greater of $3,000 or 1 percent of the Coverage A limit, unless the policyholder first receives approval from Citizens.
• Require prompt Loss Reporting by excluding coverage for permanent repairs that begin before the earlier of:

-72 hours after Citizens is notified of the loss

-The time of loss inspection by Citizens

-The time of other approval by Citizens

• Clarify that coverage does not apply for:

-collapse of plumbing caused by deterioration or age,

-access is provided only for the part or portion of the plumbing system that caused the covered loss

-insured must comply with duties after loss, there is no coverage if failure to comply prejudices Citizens.

Following those changes, at its September 2016 meeting, the Board also approved policy changes to support two new programs offered by Citizens. These programs provide
Emergency Water Removal Services and Managed Repair Contractor Network Program and are completely optional for the policyholder.

During 2017 Legislative Session, Citizens and the private insurers worked closely with The Office of Insurance Regulation to propose significant legislative changes to address the continuing problems specifically associated with assignment of benefits (AOB) abuse. Unfortunately, no legislative changes were made and the policy language changes made in 2016 have not addressed the claim costs associated with AOB and water losses. Citizens has experienced a significant underwriting loss for 2016 and it appears that the abuse and litigation in water and AOB will continue. While legislative action is ultimately necessary to curb AOB abuse, it is clear that further policy changes are also needed.

Contact John McMenamin for a free policy review and to discuss how these changes affect you.


View or Download Full PDF Summary Below:


Citizens Product Changes – Address Water Losses
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John McMenamin, P.A.
John McMenamin is a licensed Tampa attorney and has been a member of the Florida State Bar Association since 2002. Prior to that time, he worked with his past firm in many capacities when not in school, since 1991. John grew up In the small town of Geneva, NY, in the heart of what is now the Finger Lakes wine Country until later moving between Florida And NJ. He graduated from Fairleigh Dickinson University in Teaneck/Hackensack, NJ in 1998 then returned to Florida to start law school at Nova Southeastern in Davie, Florida. After graduation in 2002, he was employed By Marshall & LeValley in New Port Richey, representing clients throughout Florida, which later became LeValley & Napolitano and finally LeValley, Napolitano & McMenamin, P.L. In 2010. As of 2013, he joined Marshall, Thomas & Burnett for a brief time until Summer 2014. In October 2014, John saw the opportunity to provide a broader scope of legal representation in a more personalized small firm. He has lived in Tarpon Springs with his wife and two children since 2005.