A proposed Florida bill could strip state-backed Citizens Property Insurance from condo associations that fail to complete mandatory structural integrity reserve studies, potentially leaving thousands of residents without coverage.

New penalties for noncompliance

The bill, introduced by state Rep. Vicki Lopez, would penalize condo associations that have not completed the required studies, which assess a building's structural integrity and mandate financial reserves for necessary repairs.

The deadline to complete the study was Dec. 31, but many buildings have yet to comply.

"Our board is doing everything they can to keep us afloat, and at the same time, the people in the buildings that don't attend these meetings just don't understand," said Tony Fratianni, a resident of the Sunrise Lakes condo community in Sunrise. "I don't know if you can get water from a stone."

Fratianni said her building had to complete a structural integrity reserve study, or SIRS.

It requires condo associations to make assessments, create reserves and make necessary repairs. Each condo owner has to chip in.

Widespread impact in South Florida

A recent study by the Miami Association of Realtors found that only 44% of condo buildings in Miami-Dade County and 41% in Broward County have completed their studies.

If the bill passes, thousands of condo owners could be left scrambling for insurance in an already tight market.

"We're not asking for safety to be ignored. We're asking for elderly communities to be listened to," said Walter Raser, a concerned resident.

"In this situation, safety should not override the cost. It's literally gonna cost people their homes."

Market uncertainty and rising costs

Peter Zalewski, who runs CondoVultures.com, a firm analyzing South Florida's condo market, warned that if Citizens drops coverage, private insurers are unlikely to step in.

"If Citizens is saying, 'No, we're not gonna insure you,' I can bet the house the private sector is not going to insure," Zalewski said.

Citizens Property Insurance currently covers 18,468 condo buildings with an association, more than half of which are in Miami-Dade, Broward and Palm Beach counties.

Zalewski predicts that if many owners lose coverage, those who retain it may face higher premiums to offset the increased risk.

Lopez did not respond to a request for comment.