“Just wait until you get your insurance bill.”
That’s what Florida residents have been hearing from their out-of-state relatives and friends since last year’s hurricanes and the subsequent turbulence of the industry.
A render of a hurricane over Florida.
Already, Miami-Dade County ranks among the state’s top three counties (among 67) for the most expensive average homeowner and condo annual insurance premiums, and analysts predict those costs to get higher before a lower trajectory can begin.
According to the July 2023 Florida Office of Insurance Regulation Property Insurance Stability Report, as of March 31:
The top 5 counties with the highest average premiums for homeowners were …
- Monroe: $7,584
- Palm Beach: $5,710
- Miami-Dade: $5,665
- Broward: $5,519
- Martin: $5,157
The top 5 counties with the highest average premiums for condo owners were …
- Monroe: $3,850
- Miami-Dade: $2,633
- Palm Beach: $2,083
- Collier: $1,943
- Calhoun: $1,807
By the end of 2022, the average annual property insurance premium in Florida had risen to more than $4,200 and other estimates now place that average as high as $6,000 — compared with a national average of $1,700, according to Mark Friedlander, a spokesperson for the Insurance Information Institute.
Then, again, more than 1 in 20 Florida households are worth $1 million or more.
A luxury waterfront mansion with a small yacht parked on the water in Fort Lauderdale, Florida.
Florida property owners with “just” $300,000 to $399,999 in coverage pay an average of $2,350, compared to the national average of $1,252 for the same amount of insurance, according to the National Association of Insurance Commissioners. Naturally, coastal communities would be well above average on that scale.
The average annual premium in Florida increased 42% over the past year and 100% over the past three years, Friedlander told CNN.
With rising construction and labor costs and the increased reinsurance costs (estimated at 40-70% higher) to protect the insurers, coverage also has become more restrictive and the options have diminished as companies decide to withdraw, not renew policies or have been declared insolvent.
“The lack of reinsurance capacity for coastal property will remain the challenge for 2023 and perhaps also 2024,” said Alejandro Pérez Duque, director of the PVG Insurance Group on Key Biscayne.
Alejandro Pérez Duque.
But, he said, once new carriers enter the market, he expects inflation (at least in regard to property insurance) should subside somewhat.
“For now, we must all weather the storm and seek how to mitigate its impact as best as possible,” he said.
Just this past week, Farmers Insurance and AAA officials announced they would be limiting their coverage in Florida. But, State Farm stepped up and said it would be holding firm, seeing “more opportunity” in regard to the latest state legislative regulations.
Just six years ago, scanning the websites, one could easily find “The Top 25 Florida Property Insurance Carriers.” Now, you’re lucky to find a “Top 5” listing.
Some 110 insurance companies (and 18 of those are on the state regulator’s “watch list” due to concerns over their financial health) offer some kind of protection in the state, but as of the latest count, only these 18 (in no particular order from a WKMG-TV report) can be listed as true, domestic, active Florida carriers offering comprehensive policies (although several are not serving coastal areas):
Stillwater Insurance Group
Tower Hill Insurance
Allstate Insurance
Citizens Property Insurance Corporation
Liberty Mutual Insurance Group
Florida Family Insurance
American Strategic Insurance
Universal North America
State Farm
Security First Insurance
Florida Peninsula Insurance Company
Bankers Insurance Group
Frontline Insurance
Auto Club Insurance Company of Florida
Southern Oak Insurance Company
Universal Property
People’s Trust Insurance Company
Florida Farm Bureau Insurance
State-run Citizens, which recently asked for a 14% rate hike, has about a 42% share of the Miami-Dade market and 36% in Monroe County, which includes the Florida Keys.
According to CNN, Citizens’ coastal policies in South Florida range from $5,100 to $6,800 a year.
An aerial view of South Florida homes.
Altogether in Florida, Citizens has about a 16% market share in Florida, growing at a rate about 3,000 policies a month.
It’s hardly a surprise when learning that about 12% of homeowners in Florida in 2022 did not have property insurance, compared with the national average of 5%, according to the Insurance Information Institute.
Insurance veteran Jaden McCart, manager at the family-owned McCart Insurance Agency in Palm Bay, just north of Vero Beach, said in a previous Islander News interview that not having insurance can have catastrophic consequences, even if your property is not in the direct line of fire from a hurricane.
A fallen tree in front of The Golden Hog at Harbor Plaza after a hurricane.
“I always recommend having the wind coverage because you never know when a tornado might hit,” McCart said. “The hurricane might not be a direct hit, but a microburst or tornado can (cause major problems), even with the newest materials and best building codes, concrete block, anything … can destroy a house.”
Settling for a “should-have” traditional insurance policy (which includes fire and personal property) would save about 65% of your insurance bill, said McCart, who operates an Allstate agency, yet, as a broker, offers policies through partnering companies as well.
Flood insurance is a separate policy under the FEMA umbrella, and from its recently modified 2.0 “risk rating” system, that extra cost can be “sometimes 3-4 times more expensive for certain homes that used to be (covered under) simple, preferred policies in Flood Zone X.
“Now it’s based on being closer to the water, or ‘tidal water,’ they call it, in rivers or the ocean,” he said.
