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The Florida Homeowners Insurance Crisis: What You Need to Know

The Florida Homeowners Insurance Crisis: What You Need to Know

The Florida Homeowners Insurance Crisis: What You Need to Know

If you live in Florida and own a home, you know that homeowners insurance rates have been skyrocketing. Unfortunately, this is not just an individual problem – the entire state is experiencing a homeowners insurance crisis. As an insurance adjuster for AAN Insurance, I am here to explain what is causing this crisis, why rates are so high, and what you can do to protect yourself.

A Problem Since 1992

The first thing you need to know is that the Florida homeowners insurance crisis is not a new problem. After the devastation of Hurricane Andrew in 1992, many insurance companies stopped writing insurance policies in Florida. This created a gap in insurance coverage, which the state stepped in to fill by creating Citizens Property Insurance Corporation. Since then, many more homeowners have been seeking insurance coverage from Citizens or from private insurers, leading to a challenging market for underwriters.

Non-Weather Claims

The second factor causing the crisis is the prevalence of non-weather-related claims. In Florida, there are many factors that can cause damage to homes, such as sinkholes, mold, and water damage. While these claims are often not as catastrophic as hurricane claims, they can still be costly for insurance companies. In recent years, some insurers have been forced to raise rates or stop covering certain areas altogether due to these claims.


The third and most significant factor is the cost of reinsurance. Reinsurance is insurance sold to insurance companies, which they use to transfer some of their risk to other parties. In Florida, insurers are required to carry significant amounts of reinsurance to cover potential hurricane claims. Unfortunately, the cost of this reinsurance has been rising due to increased risk and other factors, and the cost is usually passed on to homeowners through higher premiums.

Alternative Additional Options

So, what can you do to protect yourself during the Florida homeowners insurance crisis? One option is to look into alternative forms of insurance coverage, such as excess flood insurance or private flood insurance. You can also research insurance companies that specialize in serving high-risk areas like Florida, or work with an insurance broker who can help you navigate the market.

Another option is to take steps to protect your home from potential damage. This can include investing in hurricane-resistant doors and windows, installing a backup generator, and keeping your roof in good repair. Many insurance companies offer discounts for homeowners who take proactive steps to protect their homes.

Complex Crisis

The Florida homeowners insurance crisis is a complex problem that has been building for years. While there is no easy solution, there are steps you can take to protect yourself and your home. As your insurance adjuster, I encourage you to educate yourself on your options, take proactive steps to protect your home, and explore alternative forms of insurance coverage. Together, we can work towards a more stable and sustainable insurance market in Florida.