SunSentinel.com
by Julie Patel
August 29, 2011
HomeWise Insurance in Tampa, which merged with First Home Insurance in Maitland in June, lost its financial health rating last week.
Demotech, the only rating agency that rated the company, dropped the rating Thursday. Most homeowners are required by their lenders to have property insurance from a rated company. That means if they don’t find a new insurer fast, some lenders could “force-place” coverage, or secure insurance from a rated company for the homeowners, which typically costs them a lot more.
Rules vary from lender to lender, but most banks will give customers time to find a new insurer, said Anthony DiMarco, an executive vice president for the Florida Bankers Association. “With a bank, they would get some time to find something. It isn’t going to be the next week,” DiMarco said.
HomeWise has more than 76,000 policies in the state, including about 28,000 in Broward, Palm Beach and Miami-Dade counties.
Demotech President Joseph Petrelli said some parts of HomeWise’s financial results “are stable” but it didn’t meet the financial benchmarks that it set for itself as of the end of June.
“Even though their most recent financial statement looks good, they no longer meet each and every of our numerous requirements necessary to earn” a rating of “A” or better, Petrelli wrote in an email.
