Seal of the State of Florida, Office of Insurance Regulation, 'IN GOD WE TRUST'

OFFICE OF INSURANCE REGULATION

MICHAEL YAWORSKY

COMMISSIONER

Index: OIR 2026-19

IN THE MATTER OF:

CASE NO.: 402581-26-CO

SOUTHERN OAK INSURANCE COMPANY

_____/

CONSENT ORDER

THIS CAUSE came for consideration as a result of SOUTHERN OAK INSURANCE COMPANY's ("SOUTHERN OAK") proposal to assume selected personal lines policies from CITIZENS PROPERTY INSURANCE CORPORATION ("CITIZENS"), which was submitted to the FLORIDA OFFICE OF INSURANCE REGULATION ("OFFICE") for its review on or about January 30, 2026. Following a complete review of the entire record and upon consideration thereof, and otherwise being fully advised in the premises, the OFFICE hereby finds as follows:

1. The OFFICE has jurisdiction over the subject matter and the parties herein.
2. CITIZENS has been established in accordance with the provisions of section 627.351(6), Florida Statutes (2025),1 as amended, to provide insurance for residential and commercial property qualified risks under circumstances specified in the statute.
3. The Florida Legislature enacted sections 627.351(6)(q)3.a. and 627.351(6)(ii)3. to encourage and provide a means for the depopulation of CITIZENS. Pursuant to this legislation, CITIZENS submitted a depopulation plan titled "Citizens Property Insurance Corporation Depopulation Plan" ("Plan"), which the OFFICE approved and adopted by Order No. 401992-25, on October 21, 2025. SOUTHERN OAK shall abide by the terms and conditions of the Plan and

---

1 All statutory citations contained herein refer to Florida Statutes (2025), unless otherwise noted.

section 627.351(6)(ii)3. as a condition for the issuance of this Consent Order.

1. SOUTHERN OAK is a Florida-domiciled property and casualty insurance company authorized to transact insurance in the State of Florida.

2. On or about January 30, 2026, SOUTHERN OAK submitted a proposal to assume selected policies from CITIZENS. The policies are expected to be assumed on or about June 16, August 18, and September 15, 2026, and the proposal provides for an assumption of up to 50,000 policies, consisting of 40,000 personal residential multi-peril policies and 10,000 personal residential wind-only policies from the CITIZENS' Account across all referenced assumption periods. SOUTHERN OAK's preferred policy selections during any individual assumption period shall not exceed 50% of the total policies approved to be assumed across all assumption periods.

3. SOUTHERN OAK understands that the selected policies to be assumed from CITIZENS on June 16, August 18, and September 15, 2026, or at a later date approved by the OFFICE and CITIZENS will not be subject to any incentive or bonus plan, whether statutory or otherwise.

4. Coverage offered by SOUTHERN OAK must be "comparable coverage" as required by section 627.351(6). SOUTHERN OAK cannot establish comparable coverage through the offer of optional endorsements. Comparable coverage means, at a minimum, that the offer of coverage, without endorsements, includes the same major covered perils at substantially similar levels of coverage as that already provided by CITIZENS. The premium calculation used to determine the 20% eligibility threshold detailed in section 627.351(6) must be calculated using offers of coverage that are comparable without the need to offer additional terms or endorsements.

5. Because of the potential harmful impact to Florida policyholders, SOUTHERN OAK shall not make take-out offers to CITIZENS policyholders that are more than 40% higher

than the policyholder's estimated renewal premium with CITIZENS. SOUTHERN OAK must use either rates that have been approved by the OFFICE or rates that have been filed with the OFFICE as "use and file" prior to the date by which SOUTHERN OAK must provide to CITIZENS its preferred policy selections and estimated renewal premiums for the subject assumption period as specified in the 2026 Assumption Calendar published by CITIZENS. The estimated premium offered by SOUTHERN OAK must reflect the cost of an offer of comparable coverage.

1. SOUTHERN OAK is responsible for ensuring that it has entered or will enter into appropriate agreements with CITIZENS to effectuate the assumption of policies as authorized by this Consent Order. By entering into this Consent Order, SOUTHERN OAK represents that it will comply with any such agreements between it and CITIZENS.

2. SOUTHERN OAK must timely provide to CITIZENS all information required by the 2026 Assumption Calendar published by CITIZENS. SOUTHERN OAK acknowledges that neither approval by CITIZENS nor entry into this Consent Order by the OFFICE constitutes a guarantee that the above-referenced policies will ultimately be available to SOUTHERN OAK for assumption from CITIZENS, as the availability of policies for assumption may vary over time.

3. SOUTHERN OAK shall limit its actual assumption of policies from CITIZENS to the number and type of policies authorized by the OFFICE in this Consent Order. The OFFICE based its review on SOUTHERN OAK's current and projected reinsurance programs, catastrophe modeling, and financial statement projections, as well as the impact on policyholders. Such reinsurance program, catastrophe modeling, and financial statement profiles were based upon SOUTHERN OAK's projected book of property policies, SOUTHERN OAK's projected voluntary market writings, and the actual number of policies available in CITIZENS prior to the anticipated assumption date identified by SOUTHERN OAK as satisfying its filed and approved

underwriting guidelines.

1. SOUTHERN OAK submitted the proposed reinsurance documentation and financial projections for the assumption of up to the number and types of CITIZENS' policies as set forth in paragraph five (5) above. Each additional assumption of CITIZENS' policies by SOUTHERN OAK shall be subject to advance written approval by the OFFICE.

2. SOUTHERN OAK's acquisition of adequate reinsurance and maintenance of executed reinsurance agreements are material to the OFFICE's review and analysis of SOUTHERN OAK's proposal to assume selected policies from CITIZENS and to the OFFICE's approval of assumptions in the proposal.

3. SOUTHERN OAK expressly waives its right to any hearing in this matter, the making of findings of fact and conclusions of law by the OFFICE, and all other and further proceedings herein to which it may be entitled by law or by rules of the OFFICE. SOUTHERN OAK agrees not to appeal or otherwise contest this Consent Order in any forum now or in the future available to it, including its right to any administrative proceeding, state or federal court action, or any appeal.

4. SOUTHERN OAK represents that all explanations and documents made or submitted to the OFFICE as part of its proposal to assume selected policies from CITIZENS, including all attachments and supplements thereto, fully describe all transactions, agreements, and understandings relating to the assumption of policies from CITIZENS by SOUTHERN OAK. However, all draft documents and non-executed agreements relating to SOUTHERN OAK's plan shall not be deemed approved by this Consent Order until such time as executed agreements or final documents are submitted to and approved by the OFFICE.

5. The parties agree this Consent Order will be deemed executed when the OFFICE

has signed a copy of this Consent Order bearing the signature of the authorized representative of SOUTHERN OAK, notwithstanding the fact the copy was transmitted to the OFFICE electronically. SOUTHERN OAK agrees the signature of its representative as affixed to this Consent Order shall be under seal of a Notary Public.

1. Each party to this action shall bear its own costs and attorney fees.

IT IS THEREFORE ORDERED that:

(A) Upon consideration of the proposal to assume selected policies from CITIZENS, including its attachments, the OFFICE approves the assumption of selected policies from CITIZENS, subject to adherence to the terms and conditions of this Consent Order by SOUTHERN OAK.

(B) The OFFICE approves the assumption of CITIZENS' policies up to the amounts set forth above in paragraph five (5), in accordance with any agreements between SOUTHERN OAK and CITIZENS, and this Consent Order.

(C) Regarding all reinsurance matters, SOUTHERN OAK shall:

(i) Secure and maintain catastrophe reinsurance at such levels that are acceptable to the OFFICE but in no event less than that evidenced to the OFFICE in the proposal to assume selected policies from CITIZENS;

(ii) Notify the OFFICE of any termination of any of its reinsurance agreements. The notification shall be made to the OFFICE in writing 60 days prior to the effective date of any such termination; and

(iii) Comply with the requirements of section 624.610 with regard to all of its reinsurance arrangements.

(D) SOUTHERN OAK shall participate annually in any examination of SOUTHERN

OAK's reinsurance program as requested by the OFFICE. Based upon the OFFICE's review of the models and plans, SOUTHERN OAK may be required at the OFFICE's sole discretion to take corrective action to cure any overexposure identified by the OFFICE. Such action may include obtaining additional amounts of reinsurance coverage as directed by the OFFICE or suspending writing of any additional business, including the CITIZENS policies.

(E) Upon the expiration of the assumed CITIZENS policies, SOUTHERN OAK shall provide coverage substantially equivalent to that afforded by CITIZENS either at rates that have been approved by the OFFICE or rates that have been filed with the OFFICE as "use and file," unless such policies are cancelled or nonrenewed by SOUTHERN OAK for a lawful reason.

(F) At the time SOUTHERN OAK assumes any policy of insurance from CITIZENS, SOUTHERN OAK shall either obtain a new policy application from each affected policyholder or maintain in its files a copy of the policyholder's application on file with CITIZENS. If SOUTHERN OAK chooses the former option, SOUTHERN OAK may not initiate any retroactive increase in rates or premium or any retroactive decrease in coverage provided under the assumed CITIZENS policy (if applicable) as a result of the information obtained from or through the new policy application.

(G) For a period of three (3) years immediately following the date of entry of this Consent Order, SOUTHERN OAK shall abide by the proposal to assume selected policies from CITIZENS in all material respects. Further, SOUTHERN OAK shall abide by all terms of this Consent Order and all provisions of any agreements entered into with CITIZENS.

(H) Should the OFFICE determine SOUTHERN OAK has failed to materially comply with the terms of this Consent Order, the proposal to assume selected policies from CITIZENS, including its attachments and amendments thereto as submitted to the OFFICE, or terms of any

agreements with CITIZENS, SOUTHERN OAK shall, upon receipt of notice of such material non-compliance, have 60 days to cure its material non-compliance. In the event SOUTHERN OAK fails to cure any such material non-compliance within the 60-day period, SOUTHERN OAK expressly agrees the OFFICE may enter an order directing it to immediately cease writing personal lines or other lines of insurance within the State of Florida, imposing such other sanctions authorized by statute or rule, or imposing other restrictions as may be deemed appropriate by the OFFICE.

WHEREFORE, the assumption of up to 50,000 policies, consisting of 40,000 personal residential multi-peril policies and 10,000 personal residential wind-only policies from the CITIZENS' Account, across all assumption periods occurring on or about June 16, August 18, and September 15, 2026, subject to the terms and conditions of this Consent Order, is hereby APPROVED.

FURTHER, all terms and conditions contained herein are hereby ORDERED.

DONE and ORDERED this 16 day of March, 2026.

The seal is a circular, gold-colored emblem. It features a central shield with a sun and a palm tree, surrounded by a wreath. The words "OFFICE OF INSURANCE REGULATION" are written in a circular border around the central shield, and "STATE OF FLORIDA" is written at the bottom.

Seal of the Office of Insurance Regulation, State of Florida

Image: Signature of Michael Yaworsky

A handwritten signature in blue ink, appearing to read "Michael Yaworsky".

Michael Yaworsky, Commissioner

Office of Insurance Regulation

By execution hereof, SOUTHERN OAK INSURANCE COMPANY consents to entry of this Consent Order, agrees without reservation to all of the above terms and conditions, and shall be bound by all provisions therein. The undersigned represents that they have the authority to bind SOUTHERN OAK INSURANCE COMPANY to the terms and conditions of this Consent Order.

SOUTHERN OAK INSURANCE COMPANY

[Corporate Seal]

Tony Laughman

Tony Laughman, President

Southern Oak Insurance Company

STATE OF Florida

COUNTY OF Saint Johns

The foregoing instrument was acknowledged before me by means of physical presence

or online notarization, this 13 day of March 2026, by Tony Laughman

(name of person)

as President for Southern Oak Ins Co

(type of authority; e.g., officer, trustee, attorney in fact) (company name)

[Notary Seal]

Notary Public Stamp for Ethan Campbell, State of Florida, No. MH 642645, My Commission Expires MAR. 14, 2029

Ethan Campbell

(Signature of the Notary)

Ethan Campbell

(Print, Type, or Stamp Commissioned Name of Notary)

Personally Known OR Produced Identification _____

Type of Identification Produced _____

My Commission Expires: March 14, 2029

COPIES FURNISHED TO:

Judy Grunewald, Assistant Director

Depopulation & FMAP

Citizens Property Insurance Corporation

2101 Maryland Circle

Tallahassee, FL 32303

Judy.Grunewald@citizensfla.com

Tony Loughman, President

Southern Oak Insurance Company

76 South Laura Street, Suite 1702

Jacksonville, FL 32202

Tony.Loughman@southernoakins.com

Jane Nelson, Deputy Commissioner

Property & Casualty

Office of Insurance Regulation

200 East Gaines Street

Tallahassee, FL 32399

Jane.Nelson@florir.com

Bradley Trim, Director

P&C Financial Oversight

Office of Insurance Regulation

200 East Gaines Street

Tallahassee, FL 32399

Bradley.Trim@florir.com

Corey Hubbard, Chief Financial Analyst

P&C Financial Oversight

Office of Insurance Regulation

200 East Gaines Street

Tallahassee, FL 32399

Corey.Hubbard@florir.com

Alex Ciupalo, Esq.

Assistant General Counsel

Office of Insurance Regulation

200 East Gaines Street

Tallahassee, FL 32399

Alex.Ciupalo@florir.com