On April 4, Kevin McCarthy, Commissioner of Florida's Office of Insurance Regulation approved Tower Hill to take over 43,836 policies from Citizens Insurance, beginning June 4, 2013. As part of this Citizens depopulation, Tower Hill must give 30 days advance notice to affected policyholders, informing them of the need to contact Tower Hill if they would like to remain with Citizens Insurance. Additionally, the Office of Insurance Regulation may limit the amount of policies transferred to Tower Hill, based on Tower Hills' reinsurance program, catastrophe modeling, financial statement projections and the impact on the policyholders.
As part of this transfer of policies to Tower Hill, Tower Hill is required to build to a surplus at or above $30 million, and maintain a Guaranty Agreement until they do so. Tower Hill is only required to infuse an additional $2.5 million into the company prior to beginning this transfer of policies. Tower Hill has three years to complete this Citizens depopulation program.
Tower Hill was assessed a $800,000 penalty in December for failing to maintain a minimum surplus of $50 million.