Thousand of customers of Citizens Property Insurance Corp. might be switched to other insurers without realizing they have a choice.

The state is allowing four private insurance companies to select nearly 100,000 policies to take over from Citizens by fall. Property owners can opt out of the switch, but the process has created confusion among policyholders, according to insurance agents and consumer advocates.

“It’s a disaster — no one understands,” said Pembroke Pines insurance agent Jonathan D. Rausch, who has fielded calls from homeowners after insurance companies sent letters announcing that the state approved them to “take out” policies from Citizens.

Some 119,434 Citizens policies have already been assumed by private insurers in the first seven months of this year.

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On Friday, the Office of Insurance Regulation announced a new round of takeovers. It approved the removal from Citizens of up to 91,499 multiperil personal residential policies and 5,732 commercial lines polices.

Homeowners who want to stay with Citizens are required to send in an opt-out form, which is included in the letters. In previous cases, the letters often did not include information about rates.

Citizens will send a follow-up letter that explains the benefits of private-market coverage and reminds customers that they can stay with Citizens, spokesman Michael Peltier said.

Ideally, Citizens would like to reduce its number of policies to 650,000 to 700,000, Peltier said. It’s now down to 933,422 after reaching a peak of 1.4 million in April 2012.


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Florida Insurance Consumer Advocate Steve Burgess is concerned that some homeowners may not even open a letter from one of the state-approved companies.

“The question is: Do they read it?” he asked. If they don’t, they might be switched to another company without knowing it, Burgess said.