By Andrew Powell, The Center Square contributor
(The Center Square) — A new report shows that insurance rates for property owners in the Sunshine State have increased exponentially over the past few years.
Florida TaxWatch released an in-depth analysis of Florida’s property insurance market, examining underlying factors contributing to its instability and 42.5% rise since 2019. These include damages from hurricanes and litigation, which have put pressure on insurers and forced some to leave the state.
According to the report, Florida’s property insurance market is fragile and reliant on state-run insurers as a backstop for homeowners who have no other options. Despite being a last-resort insurer, the Florida Citizens Property Insurance Company insures at least 17% of the state’s property insurance market and is also the most expensive.
The report notes that the rising enrollment in Citizens is “alarming” because if funds are exhausted to pay claims, state law requires assessments to be levied, which can then be passed on to every policyholder, including private policyholders, homeowners, renters, automobile and pet insurance.
According to a 2021 report from Florida TaxWatch, approximately 70% of Floridians live in coastal counties and are at risk of chronic flood damage. The report points out that as sea levels rise, more properties are put at risk. This equates to around 64,000 homes, with an estimated value of $26 billion, at risk of severe flooding.
Florida TaxWatch estimates that by 2100, over 1 million homes will be at risk and this increased risk will, in turn, increase property insurance rates even further. Unless the insurance market is stabilized, the high rates could push some residents to leave Florida.
Florida outdoes every other state in insurance costs, accounting for 10.8% of all premium costs in the U.S. According to the report, premiums vary between counties, ranging from $1,824 in Sumter County to $8,162 in Monroe County.
Since 2019, the Legislature has passed a series of reforms in an effort to combat insurance fraud and ease the burden on insurers. The report notes that legislative efforts are beginning to show promise. However, it also advises that lawmakers remain vigilant to prevent the market from spiraling and work to enhance resiliency.
Florida TaxWatch recommends that Florida limit its reliance on Citizens by depopulating the number of policies it holds and encouraging new private insurance companies to enter the state.
This piece was originally published at https://www.thecentersquare.com/florida/article_4ef043b6-4b94-11ef-80b2-3709618452c7.html.
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Stop all coastal construction that does not exceed Fema standards. I lost a home to Floyd in 1999. I rebuilt my house elevated seven feet. The foundation could handle a ten foot flood. It cost us alot more money. It was worth it. Four years later another storm hit and we watched the flood from our deck with cocktails. The Gulf and East coast will require much more. Before the end of the century Greenland and West Antarctica will be ice free with seas up thirty feet or more before then. Look on a map and any place less than forty feet above sea level leave now.