The state of Florida is facing a home insurance shortage, with home insurance companies canceling policies, limiting coverage, and moving elsewhere. Many of these companies have lost money in the state, and are now forced to look for new clients. Some lawmakers are looking into ways to lower insurance premiums. Rep. Tom Fabricio of the House Banking and Insurance Subcommittee said that the lack of competition in Florida could have a positive impact.
Florida is facing a unique homeowner insurance shortage. Nine property and casualty companies are in the process of dissolution or liquidation, and other insurance companies are leaving voluntarily. As a result, more companies are voluntarily pulling out of the state or drastically tightening eligibility requirements. The situation has become so dire that legislators in the state are considering legislation that will help solve the issue. Several companies have already withdrawn from the state.
Another company that has recently ceased operations is Lighthouse Insurance. A Louisiana judge has ordered the company to liquidate, giving policyholders until May 29 to find another insurer. In the meantime, any outstanding claims will be paid by the Florida Insurance Guaranty Association. As a result of the company’s decision to cease operations, thousands of homeowners are scrambling to find insurance coverage. The loss of a major home insurance company has shook up the industry.
While many homeowners are concerned about the loss of home insurance in Florida, there are several ways to prepare for it. First, you should consider how much your home insurance premiums have increased. Some homeowners have experienced huge hikes in their premiums, and you should not be left with no coverage. Another way to protect yourself and your assets is to keep your home in top condition. For homeowners who are concerned about the loss of their policies, the state’s lawmakers have passed legislation to help stabilize the market.
For homeowners who are not eligible for Citizens, they can turn to excess and surplus lines, which cover risks standard carriers won’t insure. The only drawback is that these insurers are not regulated in Florida, and their premiums are typically much higher than their standard counterparts. The lack of coverage means that many homeowners may lose their homes. Therefore, it is important to research insurance companies before choosing one. The best insurer for your home is one that offers the best service.
Other companies are also exiting the state. Olympus Insurance is one of them, but it is active only in South Florida. This means that it insures only homes built after 2010 and is primarily focused on South Florida residents. Security First is also a great option if you’ve already received a canceled homeowner’s insurance policy from a previous insurer. In addition to the canceled policies, this insurance company is also expanding its policy count, and it’s expected to hold more than 700 thousand homeowner policies by 2021.
USAA also ranks highly among homeowners insurance companies in Florida. The company was founded in 1864 and has an A++ financial strength rating from AM Best. It offers several perks, including an “environmentally friendly” rider. This policy pays for alternative energy sources after a covered incident. Moreover, it offers a decreasing deductible that gives you a $100 credit each year no matter what happens. The company’s policies are highly customizable, and offer a variety of coverage levels and deductibles to fit your lifestyle.
State Farm also has a strong financial position and offers earthquake, flood, and sewer backup coverage. Tower Hill is the cheapest Florida home insurance company, with an average annual rate $442 lower than the state’s average of $2,220. They offer special coverages for homes of higher value, and receive far fewer complaints than average. Aside from having a low-cost policy, Tower Hill also has additional features like debris removal coverage.
One of the biggest problems that Florida homeowners face is litigation. Homeowners insurance companies in Florida are facing more lawsuits than any other state, and in 2019, they filed 76% of all lawsuits against insurance companies. This adds up, and the cost of the lawsuit is passed on to the consumer. The high cost of repairing homes is already adding up to the cost of insurance. In some areas, home mortgage lenders even require homeowners insurance to make it possible.
One way to reduce Florida home insurance rates is to make your home more wind resistant. The interior of Florida is vulnerable to hurricanes, and because the peninsula is very thin, it could be hit by a hurricane from either side. As a result, Florida homeowners insurance rates are among the highest in the country. If you plan to relocate, you should make sure to take these precautions. And remember that a good home insurance policy will protect your assets.