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Mon Jun 29, 2020, 07:51 AM

Windstorm Premiums Spike Up To 1/3 In Florida, 10s Of Thousands Of Policies Canceled

Home insurance is getting a whole lot more expensive, a wallet punch for residents of a state that already has the highest property insurance rates in the nation, not to mention a staggering unemployment problem from a surging pandemic. Major insurance companies are raising windstorm premiums in Florida as much as 33 percent and dropping tens of thousands of customers, signaling an end to the nearly decade-long lull in prices. At the same time, some companies also are canceling thousands of home policies to reduce risks of corporate losses.

The reason for the spike? Reinsurance, the insurance designed to buffer insurers from big losses. It keeps the companies afloat and ensures there’s enough cash around to pay claims if a devastating storm strikes. As a rule of thumb, industry experts say, about half of every premium dollar an insurance company collects goes toward reinsurance.

EDIT

Along with price hikes, Reshefsky said he’s seen some insurers drop a big number of South Florida clients in areas considered at high risk of hurricane damage. He estimates he’s finding new coverage for about half his high-end residential clients this year. “They start closing ZIP codes. It’s become cost-prohibitive for them to do business, with the cost of the claims and the reinsurance,” he said. “What we keep getting faced with is there’s fewer and fewer options.”

The scarcity means that the remaining firms that will write the kind of policy that covers an expensive home can charge more for it. The other option is the state-funded insurer, Citizens. Late last year, major insurer Florida Specialty Insurance went belly up, forcing its 90,000 clients to find a new company, Insurance Journal reported. Citizens picked up hundreds of those policies, as well as tens of thousands more as private firms slim down their policy count to meet the rising price of reinsurance.

EDIT

https://www.miamiherald.com/news/weather/hurricane/article243766772.html

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Reply Windstorm Premiums Spike Up To 1/3 In Florida, 10s Of Thousands Of Policies Canceled (Original post)
hatrack Monday OP
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Response to hatrack (Original post)

Mon Jun 29, 2020, 08:23 AM

1. If you still owe on your home, you CANNOT cancel your premium.

Your mortgage company wont allow it.

Well, you can cancel your "current" plan, but you must replace it with another.

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Response to hatrack (Original post)

Mon Jun 29, 2020, 08:51 AM

2. They are canceling a lot in central Florida too

Thank goodness USAA has not cancelled me at least yet. My annual is 1440 a year. It goes up every year of course.

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Response to hatrack (Original post)

Mon Jun 29, 2020, 09:02 AM

3. If you have no mortgage

you don't have to carry insurance. I am in a condo in Florida and we dropped our insurance years ago when it went up so high. The association carries insurance which we pay for via our condo fee monthly. That insurance would rebuild to the inside walls and we would have to pay for the insides out of pocket. Truth is, if we get the really big one, we feel that many ins companies will go belly up and we would be lucky to see a dime on the dollar of payout. We know many single family homeowners that have dropped their policies as we did. And THAT is why the rates keep climbing. Less people paying in forcing the mortgagees to have to pay more. The repubs in Florida refuse to sit the ins companies down and work out reasonable rates as was done in California years ago.

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Response to hatrack (Original post)

Mon Jun 29, 2020, 09:38 AM

4. Gee, almost as if Florida's state government doesn't care..

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Response to hatrack (Original post)

Mon Jun 29, 2020, 10:45 AM

5. You're living on borrowed time

The financial viability of owning a home in Florida is really shaky.

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Response to hatrack (Original post)

Mon Jun 29, 2020, 11:47 AM

6. K/R Thanks for posting.

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