WEST PALM BEACH, Fla. -- Insurance agents have started to warn of increases in homeowner's insurance rates after Citizens Property Insurance Corporation, the state's insurer of last resort, said it would shed the policies of as many as 60,000 homeowners.
Under a deal with St. Petersburg-based Heritage Property & Casualty, Citizens would pay Heritage as much as $52 million to transfer the policies.
"This is a real bad thing," Scott Hendelsen, an insurance agent at All American Insurance Agency said. "A lot of people are going to be left out in the cold with no coverage. [Insurance rates] will rise."
About 24,000 of the 60,000 policies Citizens intends to shed are in South Florida.
Citizens, which has 1.3 million policies statewide, has said the move was intended to shrink its size and shore up it reserves.
Jose Matos, a West Palm Beach resident and former Citizens policy holder, said he was forced to cancel his policy after its rates doubled.
"I [would have] had to take food off of my table if I wanted to pay the insurance," Matos said.
Matos and his wife, Antonia, have lived in the same home near Haverhill Road and Purdy Lane for 24 years.
Less than ten days from the start of the Atlantic hurricane season, Matos said he prayed that South Florida would avoid the direct hit of a tropical storm or a hurricane.
"Insurance companies [are] dictating to people how to live," Matos said. "Either you pay them or you go without it."
Matos, who owns his home, isn't required to insure it.
Homeowners with mortgages are, however.
Policy holders affected by the Citizens decision will be notified in late June and will have 30 days to opt out of the transfer to Heritage.
Copyright 2013 Scripps Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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