Homeowners Corner: Making it through this insurance crisis

You hear it everywhere, your neighbor, your friends, passersby in conversation on how their homeowners insurance is increasing again. You receive your bill or mortgage statement showing another increase and you become angry, frustrated or scared knowing you must find another way to cut costs. Know, you are not alone; every homeowner in the State of Florida is in the exact same position.
With so many changes in the world, whether it’s a pandemic, a recession, increase in cost of living and everyday life, all you can think of “what’s next”. As a consumer and an Insurance Agent, I understand and can say from personal experience that it is frustrating and a little nerve wracking, but I can also say that we will get through this, together.
Getting to know your local insurance agent is the first step to combating this problem. You want to check into their business, their experience, knowledge base and see how involved they are in the community. Are they talking to local business owners, property owners and the insurance carriers that are covering your property? Are they sitting down with you, whether face to face or over the phone and taking the time to answer your questions, review your insurance needs and truly explaining the situation to you?
Getting to know your local insurance agent won’t guarantee you the lowest rate, however; if you have done your due diligence, it will allow you the opportunity of having the right insurance coverage that will protect you in the event of a loss. This is not to say that they will tell you what you want to hear but they will try to find ways to get you what you need.
I have listed below some facts that will give you a little more understanding in what the industry is facing. While knowing this won’t make your premiums drop, it will give you a better insight into why we are in our current predicament. Through various Podcasts, Insurance Journals, Florida Association of Insurance Agents and articles through the Florida Department of Insurance Regulations, I have written down the following statistics that will give you better insight as to where Floridians stand in the current difficulties of finding insurance, keeping insurance or being able to afford insurance.

  • Between 2013 and 2020 Florida property insurers paid out fifteen billion in claims cost with only 8% being paid to consumers, while 71% was paid to attorneys.
  • In 2019 Florida was only responsible for 8.15% of all United States Claims but accounted for more than 76% of property claim lawsuits in the United States.
  • In 2020, financial reviews show property insurers reported $1.6 billion in underwriting losses
  • In 2021, financial reviews show property insurers reported $1.22 billion in underwriting losses
  • In 2022 over 400,000 Florida homeowners have been dropped or received notices of non-renewal letters
  • Over the course of the last several years, homeowners have been averaging a 33% rate increase
  • In 2022, there have been on average over 4,000 lawsuits each month
    As stated previously, you are not alone; you have resources. Don’t talk to just one agent or agency. Ask the questions. Do the research, ask your agent what carriers they represent and then look into them. Find out how long a carrier has been operating in the State of Florida; learn their financial status through AM Best or Demotech. Talk to your neighbors, your friends, your co-workers and see who they do business with. There will always be ups and downs in every situation and the insurance industry much like the rest of the world is in a downward spiral but will bounce back.