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Small Insurers, More Options

Tampa Tribune - 02/22/08 By Russell Ray

PURE provides coverage to a specific market. The homes must be worth $1 million or more and built to standards that equal or exceed building codes. "A quarter of what we do is beachfront," said Buchmueller, the company's CEO. "Our business is extremely selective. The criteria to gain entry is very narrow."

The member-owned insurer has about 2,000 members and 3,500 policies, including auto policies. Buchmueller expects the company to double in size by year's end. In addition to its selective coverage, PURE is unique in that its members contribute 10 percent of their premium to the company's cash surplus each year.

"We do not resemble in any way any other company that you could speak to," Buchmueller said. "If we broke even, we would still grow surplus by 10 percent a year."

Also, PURE limits its membership to 425 members per county, a policy that helps keep risk and exposure reasonable, he said.

PURE's growth is poised to soar next year. That's because, beginning in December, state law requires state-backed Citizens to drop customers with homes worth $1 million or more.

"It's almost $20 billion of insured values," Buchmueller said. "All of this business is going to find its way into the private market, and we think we're well-positioned to take large chunks of that."

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