As chairman of the Florida Senate Insurance Committee, I was heavily involved in the insurance crisis that followed Hurricane Andrew more than 30 years ago. Unfortunately, once again, we are in an eerily similar situation with homeowners and insurers alike suffering.
Recently the market took another hit when Farmers Insurance became the fourth insurance company to leave the state within the past year. Then AAA piled on and said it would issue some non-renewals on a small percentage of its business within Florida. Both Farmers and AAA indicate their changes are because it’s become increasingly difficult to manage risk exposure in Florida.
This is underscored by Hurricane Ian’s devastation on the Gulf Coast, rebuilding, and recovery costs, leading to an unprecedented rise in reinsurance rates. Those increases, escalating housing prices, and inflation rates are creating the perfect storm for homeowners, especially our seniors who are on fixed incomes.
According to the Insurance Information Institute, the average annual property insurance premium in Florida is more than triple the national average. If homeowners haven’t lost their insurance, they’re likely to face rate increases. If they lose their insurance and can’t find a replacement, then they face foreclosure because most banks require proof of insurance to write loans on mortgages.