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Why are Florida Home Insurance Rates So High?

By February 2, 2022Insurance

Florida Homeowners Insurance You are in the beloved Sunshine State, own a home or have recently bought a house, and are excited about living the Florida lifestyle. What frustrates property owners in Florida while enjoying their beautiful home, they are faced with sky-high Property Insurance. Research shows that compared to other Americans, Florida homeowners are paying more than double the insurance cost. The average homeowner’s insurance premium in Florida is $3,439/years, which is almost double what is was just a few years ago.

Reasons Behind the High Insurance Rates in Florida

Natural Disasters: One of the major reason why home insurance is so expensive in the area is due to the risk of natural disaster. Hurricanes Irma, Michael, Matthew, Frances, have created a constant threat to the properties in the state and the risk of covering them has lead to an increase in the home insurance premium.

Litigation: Litigation in the second major reason for the expensiveness of coverage in Florida, and has also led to few options available for coverage when a homeowner receives a premium increase. Many insurance carriers are unwilling to insure homes in Florida, where homeowner’s insurance lawsuits accounted for 76% of all litigation against insurers across the country in 2019. In 2020 there were 384 homeowner’s insurance lawsuits filed per day, and of these litigated claims, 70% were roof related.

Politics and Regulators: Given this litigious environment, only three (3) companies writing homeowner’s coverage have a cumulative positive net income in the last 5 years out of 53 residential carriers. Florida regulators have had to take the step to allow large rate increase filings by insurance companies in order to keep companies from exiting the state entirely.

Florida homeowners are thus being asked to pay larger premium as their policies renews. In addition insurance companies have tighten underwriting guidelines, especially regarding the age of a roof for coverage, shrinking available options agents have to offset premium increases for older homes and homes with roofs over ten years old.

Available Options: As an independent agency, representing over 30 companies, we have options for our clients in the event of a substantial renewal rate actions. We also have options for policies cancelled because of roof age, and options for policies nonrenewed because an insurance company has reduced their exposure in a county or zip code

Property insurance might be a cause of worry for residents in Florida, but there are options to maintain coverage and at a reasonable premium. Get a home insurance quote for your property.