Life After Runoff? Anchor Insurance Exploring ‘Possibilities’ in Warming Florida Market

It’s rare for a property insurance company to emerge from an orderly runoff and re-enter the marketplace as a going concern. In fact, it has never happened in Florida, industry experts say.

But that may be what is about to happen with Anchor Property & Casualty Insurance Co., after board members with Anchor Insurance Holdings decided to bring in a longtime industry executive to test the waters and explore possibilities.

“The board has decided to consider an array of possible business plans,” said John Rollins, who was named CEO of the St. Petersburg-based company in October.

Rollins has spent 32 years in the Florida insurance industry, including stints as chief financial officer at Olympus Insurance and at Gemini Financial Holdings, and as chief risk officer for Cabrillo Coastal General Insurance and as risk officer at Citizens Property Insurance. Most recently, he was director of ventures at Evans Insurance Holdings, vetting companies for potential investment.

A rebirth of a troubled insurance company would be remarkable in Florida. At least two major insurers, United Property & Casualty Insurance and FedNat Insurance Co., in the last three years entered orderly runoff plans only to be deemed insolvent within months. Eight other Florida property insurers in the last few years skipped the runoff stage and went straight to insolvency and liquidation proceedings.

But Anchor’s recent move appears to an indicator of a rapidly improving market. Insurance executives across the state have credited 2022 and 2023 insurance and tort-reform legislation with stemming what had been called runaway claims litigation and costs. At least five other new carriers have entered or plan to enter the Florida market in coming months.

Anchor “is in a solvent, publicly administered supervision. It’s adequately reserved, running off remaining claims,” Rollins said.

Just about 20 outstanding claims remain, and the company has adequate reserves available to pay those, he noted.

Anchor P&C Insurance was first licensed in Florida in 2014 and was approved to take out thousands of Citizens policies. As recently as 2019, Anchor held more than 43,000 policies in the state, with about $69 million in premium, regulator reports show. At one point, it offered homeowners insurance in 12 other states.

But by 2016, Anchor was losing money and continued to do so through 2018, regulatory and news reports indicate. Three groups of investors that year gained control of the company and provided infusions of capital. But the net losses continued. In 2019, the Demotech financial rating firm announced it would soon downgrade the carrier.

Anchor sold its Texas subsidiary, renamed Anchor Specialty Insurance, to Weston Insurance Holdings (and Weston P&C Insurance Co. itself was declared insolvent in 2022). The renewal rights to most of Anchor P&C policies also were sold in early 2020 to HCI, Homeowners Choice Insurance, as Anchor was placed into runoff. The regulatory supervision order has been extended several times since then.

Until recently, Brian Katz was CEO of Anchor P&C; David Weiner was CFO; Pramod Datta Kerker, Kyle Hooker and Christopher Moench are shown as board members, according to a 2021 examination report by the Florida Office of Insurance Regulation. As of the end of 2021, Anchor reported a policyholder surplus of about $400,000. It holds no policies at this time.

Rollins said the board has given him no timetable to make recommendations on the feasibility of re-entering the market. He declined to provide information on potential investors in the company.