Wednesday, November 30th, 2022

Revealed – what’s tearing aside Florida’s owners’ insurance coverage market?

It was additionally famous that whereas two main hurricanes made landfall in Florida since 2016 – 2017’s Irma and 2018’s Michael – there have been no direct hits over the previous three hurricane seasons, from 2019 to 2021. And but Florida accounts for 79% of all owners’ insurance coverage lawsuits filed nationwide, and insurers working within the state obtain solely 9% of all US owners’ insurance coverage claims, primarily based on information from Gov. Ron DeSantis’ workplace.

“Floridians pay the best owners insurance coverage premiums within the nation for causes having little to do with their publicity to hurricanes,” mentioned Triple-I CEO Sean Kevelighan. “Floridians are seeing owners insurance coverage change into costlier and scarcer as a result of for years the state has been the house of an excessive amount of litigation and too many fraudulent roof alternative schemes. These two elements contributed enormously to the web underwriting losses Florida’s owners insurers cumulatively incurred between 2016 and 2021.”

Utilizing information from the Florida Workplace of Insurance coverage Regulation (OIR), 3D Supra reported that $51 billion was paid out by Florida insurers over a 10-year interval. Of the $51 billion, 71% went to lawyer’s charges and public adjusters. The 2020 and 2021 cumulative web underwriting losses for insurers working within the state totaled over $1 billion annually.

“The state’s owners’ insurers have been compelled to reply to these unlucky market tendencies this 12 months by limiting new enterprise, non-renewing present insurance policies and even canceling insurance policies mid-term,” commented Kevelighan. “What’s extra, 4 owners’ insurance coverage firms have been declared bancrupt since February – all whereas extra Individuals are shifting to Florida than another state.”

Learn extra: One other Florida insurer teeters getting ready to insolvency

Triple-I additionally introduced consideration to Residents Property Insurance coverage Company, the state-backed insurer of final resort, which noticed its coverage depend rise to almost 900,000 this month statewide.

Learn extra: State-backed Residents Property Insurance coverage hit by surge in lawsuits

The institute additionally famous that third-party ranking bureaus have downgraded the monetary rankings of some insurance coverage firms in Florida, which places much more stress on the affordability and availability of house owners insurance coverage within the state.

Learn extra: Insurer ordered to liquidate

A typical Florida owners’ insurance coverage policyholder paid $2,505 for protection in 2020, Triple-I mentioned. However that quantity has jumped to $3,181 in 2021, primarily based on OIR, Nationwide Affiliation of Insurance coverage Commissioners (NAIC), and Triple-I’s estimates of what insurers are paying for dwelling alternative prices.

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