Citizens Insurance and Florida Condos — What Unit Owners Need to Know Before, During, and After Landing in Citizens

If you own a condo in Florida, there’s a growing chance that Citizens Property Insurance Corporation has already touched your life—or will soon. Whether it’s your condo association’s master policy, your personal HO-6 policy, or both, Citizens has become a central player in Florida’s property insurance market.

For many condo owners, Citizens feels like a lifeline. Premiums are often lower, coverage is available when private carriers decline, and it keeps owners insured when options are limited. But Citizens is not just another insurance company. It comes with unique rules, coverage limitations, and long-term risks that every Florida condo owner must understand.

In Week 9 of the Florida Condo Insurance Education Series, we’re breaking down the reality of Citizens insurance for condo owners—what it is, why so many condos end up there, how coverage differs from private carriers, and what you should do to protect yourself if Citizens becomes part of your insurance picture.

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What Is Citizens Insurance and Why Does It Exist?

Citizens Property Insurance Corporation was created by the State of Florida to serve as the insurer of last resort. Its purpose is simple: ensure that Florida property owners can obtain insurance when the private market will not offer coverage at a reasonable price.

Citizens is not designed to be the first choice. It is meant to be a temporary safety net when:

• Private insurers decline coverage
• Premiums become unaffordable
• Buildings fail underwriting guidelines
• Coastal or older properties are considered too risky

As Florida’s insurance market has tightened, Citizens has grown dramatically—especially among condo associations and unit owners.

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How Citizens Impacts Florida Condos in Two Different Ways

Citizens can affect condo owners in two very different scenarios, and it’s important to understand which one applies to you.

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1. Citizens as the Condo Association’s Master Policy Carrier

In this scenario, Citizens insures the entire building, including:

• Structural components
• Roof
• Exterior walls
• Common areas
• Elevators and hallways
• Association liability

When private carriers refuse to insure an aging or coastal condo building, Citizens is often the only option available to the association.

Why This Matters to Unit Owners

Even if your personal HO-6 policy is with a private carrier, a Citizens master policy can still affect you through:

• Higher hurricane deductibles
• Greater likelihood of special assessments
• Longer claim timelines
• Stricter underwriting requirements
• Increased financial exposure after storms

The association’s insurance directly impacts your risk—even if you don’t hold a Citizens policy yourself.

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2. Citizens as Your Personal HO-6 Condo Policy

Citizens also writes policies for individual condo unit owners when:

• No private carrier will offer coverage, or
• Private coverage is more than 20% higher than Citizens (the “20% rule”)

They are common for:

• Coastal condos
• Older buildings (40+ years)
• Buildings with prior claims
• Condos with outdated plumbing or electrical systems
• Owners seeking affordability in a difficult market

However, Citizens HO-6 policies are not identical to private-market HO-6 policies.

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Key Differences Between Citizens and Private HO-6 Policies

While Citizens provides essential coverage, there are important limitations condo owners must understand.

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Lower Loss Assessment Coverage Limits

Loss assessment coverage is critical for condo owners because it helps pay your share of:

• Hurricane deductibles
• Fire or water damage to common areas
• Liability claims against the association

Private carriers often allow loss assessment limits of:

• $25,000
• $50,000
• $100,000

Citizens typically includes very low default limits, often as low as $2,000, unless increased by endorsement—and even then, options may be limited.

In Florida, where hurricane deductibles can result in assessments of $5,000–$25,000 per unit, this is a major exposure.

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More Restrictive Water and Mold Coverage

Water damage is the number one condo claim in Florida, yet Citizens policies often include:

• Lower mold coverage limits
• Tighter underwriting around plumbing age
• Restrictions on older water heaters
• Stricter claim scrutiny

In a high-humidity state, limited mold coverage can quickly become a serious problem after a water loss.

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Limited Coverage for Certain Features

Citizens may limit or exclude coverage for:

• Screened enclosures
• Glass balcony enclosures
• Certain interior upgrades
• Detached structures
• Add-ons not considered part of the original unit

Private carriers often provide broader coverage for these items through endorsements.

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No Ability to Schedule High-Value Personal Property

Citizens does not allow condo owners to schedule valuables such as:

• Jewelry
• Watches
• Artwork
• Collectibles
• Firearms

To protect these items, owners must purchase separate policies through private carriers.

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Slower Claims Handling in Widespread Events

Citizens insures a massive number of properties. After hurricanes or major storm events, this can result in:

• Longer claim adjustment timelines
• Increased documentation requirements
• Slower payments compared to private insurers

For condo owners dealing with interior damage and potential mold growth, delays can increase out-of-pocket costs.

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Understanding Citizens Depopulation (“Take-Out” Programs)

One of the most misunderstood aspects of Citizens is depopulation.

What Is Depopulation?

Depopulation occurs when a private insurance company agrees to “take out” Citizens policies and move them into the private market.

This can happen when:

• Market conditions improve
• New insurers enter Florida
• Your building becomes more insurable

Why Condo Owners Should Pay Attention

If you are depopulated:

• Your policy may be transferred automatically
• Coverage terms may change
• Deductibles may increase
• Premiums may rise
• Endorsements may differ

You typically have limited time to review and respond to a take-out offer.

Citizens is not permanent coverage, and owners should always be prepared for a transition back to the private market.

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What Happens When the Building Is in Citizens but You Are Not

This is a common scenario.

Your personal HO-6 policy may be with a private carrier, while the association’s master policy is with Citizens.

This combination often results in:

• Large hurricane deductibles passed to owners
• Greater need for loss assessment coverage
• Increased assessment frequency
• Higher financial exposure during storm events

Your HO-6 policy must be structured specifically to account for a Citizens-insured master policy.

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When Citizens Is the Only Realistic Option

There are situations where Citizens is unavoidable and appropriate:

• Barrier island condos
• Older coastal buildings
• Buildings undergoing structural remediation
• Condos with prior claim history
• Buildings with outdated electrical or plumbing systems

In these cases, Citizens provides critical protection—but owners must understand and plan for its limitations.

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How Florida Condo Owners Can Protect Themselves While in Citizens

If Citizens is part of your insurance reality, there are steps you can take to reduce risk.

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Increase Loss Assessment Coverage Where Possible

This is one of the most important protections for condo owners in Citizens.

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Supplement with Additional Policies

Examples include:

• Flood insurance
• Umbrella liability policies
• Separate jewelry or valuables coverage

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Understand the Master Policy Deductible

Know the hurricane deductible and how it is allocated among unit owners.

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Document Your Interior Thoroughly

Photos, videos, and renovation records help protect you during claims—especially when coverage is limited.

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Review Every Depopulation Notice Carefully

Never assume a take-out offer is better or worse without reviewing coverage details.

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Work With an Agent Who Understands Condo Risk

Citizens coverage requires careful coordination between:

• The master policy
• Your HO-6 policy
• Your endorsements
• Your financial tolerance for risk

This is not an area for guesswork.

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Why Some Condo Owners Move Back to the Private Market

Even when Citizens is cheaper, some owners choose private coverage because it offers:

• Broader endorsements
• Higher loss assessment limits
• Better water and mold coverage
• Ability to schedule valuables
• Faster claims handling
• Greater customization

Cost alone should not drive the decision—coverage quality matters, especially in Florida condos.

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Final Thoughts: Citizens Is a Safety Net, Not a Strategy

Citizens plays a vital role in Florida’s insurance system, especially for condo owners facing limited options. But it is not designed to be permanent, comprehensive, or flexible coverage.

Florida condo owners who understand Citizens—and plan around its limitations—are far better positioned to protect themselves financially.