BY FIRM PRESIDENT MEL MONTAGNE
Florida’s SB 1028, which aims to establish a commercial lines clearinghouse for Citizens Property Insurance Corporation policies, is a misguided piece of legislation that prioritizes special interests over genuine competition and consumer protection. While proponents claim it will depopulate Citizens and foster a healthier private market, the bill’s structure does the opposite: it entrenches favoritism, imposes unnecessary costs, and risks burdening already-strained commercial customers with higher effective premiums.
CITIZENS DEPOPULATION EFFORTS
We have seen dramatic declines in Citizens’ policies—so is this legislation even needed? Citizens’ overall policy count has plummeted from a peak of around 1.4 million in late 2023 to just 391,768 as of mid-February 2026, with expectations it could dip even lower. This represents a massive shift of hundreds of thousands of policies back to the private market through existing depopulation programs, tort reforms, and improved market conditions. Commercial lines have followed suit, with significant reductions in both commercial residential and non-residential exposures. The private market is already functioning effectively, attracting policies without the need for a costly new clearinghouse apparatus.
cronyism or reform?
At its core, the original version of SB 1028 (and even aspects of recent amendments) appears designed to hand significant control over the clearinghouse to a single large brokerage—widely understood to be Ryan Specialty (often referenced in criticisms as Ryan Turner Specialty or similar). Critics, including Florida brokers, agents, and Insurance Commissioner Michael Yaworsky, have pointed out that the plan could give one entity outsized authority to administer the platform, decide participation, and potentially sideline smaller brokers. This isn’t competition—it’s cronyism disguised as reform. True market competition would encourage multiple players, transparent processes, and broad access, not concentrate power in the hands of one dominant wholesale brokerage headquartered out-of-state.
The bill’s lack of meaningful safeguards exacerbates this problem. Without strict caps on administrator fees and surcharges, the clearinghouse operator could impose burdensome add-ons that inflate the total cost of coverage for policyholders. Commissioner Yaworsky’s proposed rewrite wisely pushes for limits—such as fees not exceeding $100 per policy and requiring total costs (premium plus fees) to factor into comparability—but the current Senate-amended version falls short on robust protections. Florida’s commercial property owners, especially in condo associations and small businesses, deserve better than a system where hidden or excessive fees could quietly drive-up costs without delivering proportional value.
PREMIUM THRESHOLD CAP DEFIES AFFORDABILITY
Compounding the issue is the bill’s 20% premium threshold for forcing policyholders out of Citizens. If a surplus lines or private offer comes in within 20% of Citizens’ rate, the policy can’t stay with the state-backed insurer. This threshold is far too generous in today’s environment. Commercial customers have endured astronomical premium increases over the past several years—double-digit hikes annually in many cases, driven by reinsurance costs, litigation, and storm risks. Even as the broader market shows signs of stabilization (with some surplus lines segments seeing recent declines and Citizens proposing modest commercial adjustments), forcing businesses to accept offers up to 20% higher ignores the cumulative pain already inflicted. A more reasonable cap—such as 5%—would better protect policyholders from being pushed into pricier, less-regulated surplus lines coverage without true affordability. Surplus lines insurers operate with fewer consumer protections, making this shift riskier for unsophisticated buyers like many commercial and condo owners.
sb1028 UNDERMINES MARKET STABILITY
Recent amendments to SB 1028 have made some improvements—mandating an admitted clearinghouse first, prioritizing regulated carriers, enhancing OIR oversight, and banning public funding—but they don’t fully address the favoritism concerns or tighten the premium threshold enough. The commissioner’s rewrite, which deletes problematic equalization clauses, requires Florida-based administrators free of conflicts, caps commissions, prohibits fronting, and adds time limits on administrator contracts, represents a far superior path. Yet the rush to pass the bill before full House consideration risks locking in flaws.
Florida’s insurance reforms have made strides in stabilizing the market, with Citizens’ overall exposure dropping dramatically and some rate relief emerging. But SB 1028, in its current form, undermines those gains by creating an uncompetitive, potentially costly mechanism that favors one player while exposing commercial policyholders to higher burdens—at a time when depopulation is already succeeding rapidly without it. Lawmakers should reject or substantially amend this bill to prioritize real competition, fee transparency and caps, stronger regulator authority, and a lower (5%) premium differential threshold. Anything less betrays the very businesses and property owners the legislation purports to help.