Six property insurers have left Florida so far this year, and industry analysts expect more to leave by the end of 2022.
Florida’s property insurance market was already in a crisis before Hurricane Ian, and the storm could be making a bad situation even worse.
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Some suspected insurance might become more difficult to find and more expensive to boot.
Mark Friedlander is with the Insurance Information Institute.
“There are very few options in the Florida insurance market right now...” Friedlander said. “It is very possible that some of the smaller regional insurers that write home business in Florida will deplete their surplus as a result of the losses from Ian.”
“If that is indeed the case, then we will lose more of these smaller regional insurers,” he said.
According to Friedlander, if that happens, then Florida could potentially lose more of those smaller regional insurers by the end of this year.
“Typically, this happens pretty quick because claims are being filed so fast,” Friedlander said.
Florida’s insurance market was already struggling before Hurricane Ian. Insurers claimed that excessive litigation and roof schemes drove up the prices before the storm.
Right now, the average home premium in Florida is the highest in the U.S. at more than $4,200 a year, nearly three times the U.S average, which is just over $1,500 annually, according to an analysis by the institute.
“Looking a bit down the road, meaning 2023, potentially we could see average increases of 40% or higher here in Florida,” Friedlander said.
Every homeowner in the state has already seen increases over the last couple of years.
This year, the statewide average for insurance increase has been 33%, which is triple the U.S average of a 9% increase, Friedlander said.
Before the state declares an insurer insolvent, the state will work with another insurer to absorb all of those policies.
Typically, you don’t have to do anything.
You’ll get a letter in the mail from the new company, saying your policy is being honored with the same coverage for the same term.
At the end of the term, the new company will send you a letter with their renewal agreement if they’re still writing policies.
Then, you can decide whether you want to stay with them or shop around.
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