Florida Homeowner's Insurance: Think Twice Before Moving Here

[SpongeScott]

State Farm announced rate increases by 71.5 to 95.3%.

Allstate is dropping 174,000 customers.

http://hosted.ap.org/dynamic/stories/F/FL_HURRICANE_INSURANCE_FLOL-?SITE=FLPET&SECTION=STATE&TEMPLATE=DEFAULT

 

[Nemo14]

State Farm announced rate increases by 71.5 to 95.3%.

Allstate is dropping 174,000 customers.

http://hosted.ap.org/dynamic/stories/F/FL_HURRICANE_INSURANCE_FLOL-?SITE=FLPET&SECTION=STATE&TEMPLATE=DEFAULT

That s____s big time!

 

[napnet]

Yeah i didn't get renewed this year and had to pick up new insurance that was alot more expensive. Went from $450/yr to $780/yr and we haven't had a hurricane since Kate in 1985. My old insurance as Tampa based and they dropped ALL their florida properties

 

[SpongeScott]

Yeah i didn't get renewed this year and had to pick up new insurance that was alot more expensive. Went from $450/yr to $780/yr and we haven't had a hurricane since Kate in 1985. My old insurance as Tampa based and they dropped ALL their florida properties

Alabama property insurance (old home): $700/year
Florida property insurance (2005): $1680
Florida property insurance (2006): $2990
Florida property insurance (2007): could be $7000

:brick:

 

[PigletIsMyCat]

Insurance isn't a scam. It's a safety net. And, first and foremost, it's a business. They answer to their bottom line. Some people are 'lucky' or 'healthy'; they pay $300 a month for health insurance, but never get sick. They pay $168 dollars a month for car insurance, and never get in a car accident. But then, think of people who pay those premiums and have diabetes or asthma. Without insurance, asthma medication can cost in excess of $300 a month easily. Diabetes medication is even more. And what about people who get in car accidents, especially when it isn't their fault, or they're a passenger? Hospital bills - even for a short ER visit - can be thousands of dollars. One MRI can be almost $1,000.

Does it stink? Yes, it does stink for homeowners, especially those who have been lucky enough to not have to file a claim. Will it stop people from buying in Florida? No. No it won't. Our homeowners insurance in New York is almost $1000 a year. We don't have hurricanes that cause major damage this for up the coast, we don't flood (and anyway, that's a different insurance), we don't have tornadoes, we don't really have anything that occurs fairly regularly that could seriously damage a home.

 

[napnet]

Alabama property insurance (old home): $700/year
Florida property insurance (2005): $1680
Florida property insurance (2006): $2990
Florida property insurance (2007): could be $7000

Yeah, not lookning forward to that when i move to Central Florida in 08... atleast up in the panhandle its still cheap but barely. if we got even a cat-2 up here were in trouble. We havent had anything over a tropical depression 21 years so we got all these trees just waiting to be knocked down. I have 3 huge live oak tree's that hang over my house too :lookaroun

 

[Tim G]

State Farm announced rate increases by 71.5 to 95.3%.

Don't tell me... I know...:lookaroun In our case, almost 79%...

 

[mkt]

Great... this is what I get for buying a house

 

[figmentmom]

Scott, I understand your frustration with the homewoners' insurance issue, and I can't even begin to imagine having to pay those premiums! Is the cost of living in Florida significantly higher in general? I always thought New York was the most expensive place in the WORLD to live, but I'm starting to wonder.

 

[Woody13]

I have State Farm and I feel your pain!

2004 HURRICANE SEASON CONTINUES TO CHALLENGE FLORIDIANS

Consumers will pay to bail out Citizens Insurance Corp. Citizens, the state sponsored insurance carrier, reportedly incurred some $2.4 billion in hurricane claims, which left its treasury $516 million short. This deficit will be paid by an assessment on every other homeowner’s policy sold in the state.

The irony of the assessment is that every policy holder in the state of Florida except policy holders with Citizens Insurance will be assessed to make up for the inadequate rates charged by Citizens.

The assessment is not going to make anyone happy. Those persons who pay the assessment are upset about paying for losses sustained by other insured policies and the persons insured by Citizens are going to be angry with the new rates that have to allow for a similar season.

Citizens’ request came to light just as State Farm, Florida’s largest insurer, asked state regulators for permission to raise homeowner insurance premiums statewide by an average of 8.6 percent. Some counties will exceed the percentage. In Palm Beach County and the Treasure Coast, both hit hard during last year’s storms, State Farm has asked for rate increases that will amount to as much as 34.5 percent. It’s State Farm’s second rate hike request since December, when the company asked for and received a five percent premiums increase.

Allstate Insurance and Nationwide Insurance also have asked for significant rate increases. The Florida Department of Insurance granted a 21 percent hike for Nationwide and a 26 percent increase for Allstate Floridian.

Even with the increased rates, Allstate, the No. 3 writer of homeowners insurance in Florida has decided to stop writing homeowners policies in the state and has notified the department of insurance that it will not renew 90,000 policy holders (see HP, Summer 2005, page 6).

Nationwide released a report saying that it will no longer sell new policies in Florida as of September 1, and is considering dropping up to 30,000 homeowners statewide.

This revelation follows on the heels of an announcement in which the company indicated it would not write new policies in Florida after September 1. Nationwide becomes the seventh company to announce it is leaving Florida, or not writing new policies in the state since last year’s devastating hurricane season.

 

[Woody13]

Bailout of Citizens will just paper over the real problem

With an election coming up, legislators in Tallahassee recognize a free lunch when they see one: Unhappy constituents, complaining about rising insurance rates worsened by a surcharge to make up for hurricane losses suffered by state-run Citizens Property Insurance ... and an unexpected windfall of almost $1 billion in state revenue.

That sound you hear is legislators rushing to use the new money to bail out Citizens, and greatly reduce the proposed surcharge. In fact, they're so giddy about what they're doing, the Orlando Sentinel reported, that the Senate approved an amendment "requiring insurers to include on their premium notices, 'in 12-point type,' a statement crediting the Legislature for reducing the cost of the surcharge."

We're only surprised they didn't specify bold-face type.

Unfortunately, they forgot one thing: There's no such thing as a free lunch. And while it will no doubt win them short-term gratitude from homeowners unhappy about the rising cost of insurance, it ignores the long-term problem (while eating $1 billion the state might wish later it still had).

The bigger problem is what to do about insurance in Florida, and about Citizens, now the second-largest home insurer in the state. Because the Citizens problem is the result of an insurance crisis that reflects the risky, unsustainable nature of much development in Florida.

The state sidestepped -- and worsened -- that problem by creating Citizens in the first place. When private insurers began refusing to take on the risk of unsound development -- or to price it accordingly -- the state failed to recognize what the market was telling it and opted to subsidize that development itself by creating Citizens.

The state's poor judgment was confirmed by recent hurricane seasons, which plunged Citizens into deficit. (In contrast, the private insurance industry absorbed its hurricane losses and remained remarkably profitable -- in part a testament to its wisdom in declining the kind of risky development that ended up in the Citizens pool.)

So now, the state proposes to subsidize Citizens through the general fund -- a precedent it may come to rue severely if future hurricane seasons are anything like the last two.

A basic rule of government is that if you subsidize something, you likely will get more of it. If the state subsidizes Citizens, it risks encouraging more of the kind of development that has made Citizens such a risky -- and money-losing -- proposition.

Yes, the alternative is to let policyholders across the state pay the surcharge. They don't want to -- but doing so will incur the necessary pain required to force all of us to understand the nature of development in Florida, and the real costs necessary to pay for it.

The state bailout, on the other hand, will paper over this reality for another year, and encourage everyone to keep digging, ever deeper, the hole we're in.

 

[PigletIsMyCat]

Please don't try to tell me about insurance, I come from a family that is very much involved in the insurance industry.

As for myself, I have asthma...I know what the meds cost. As far as other illnesses that insurance companies deny you for...some of my family members have them, so I am very aware of how the insurance industry works.

Yes...insurance is a scam, any company that takes your money and then fails to comply with their end of the deal is a scam...so please don't get me started on my occurrences with insurance.

I'm sorry that your involvment with insurance companies in general has been so damaging. I too have family members in the health insurance industry, one of them for over 25 years.

I have never had an insurance company deny me for any of my necessary medications, and I am a severe asthmatic and have other serious medical problems due to two incredibly serious car accidents that I should not have been able to live through. I have multiple family members who are insulin dependant diabetics, who would not be able to afford their insulin and syringes without health insurance. I have never had a health insurance company 'fail to comply with their end of the deal' and there are actually state and federal organizations to help with that.

Does the health insurance system suck? Yes, it sometimes does. But it is better than nothing. Without insurance, I would be dead, my father would be dead, a lot of people would be dead for minor things, like asthma or infections. If you want to be angry at someone, be angry at all the people who file false claims, committing insurance fraud, and drive up all our rates. Be angry with the people who file frivolous malpractice lawsuits and drive up our physician's malpractice insurance, forcing the doctors to pass the pirce hike on to us.

If a health insurance company denies a claim that you feel should be covered, you must file an appeal within a certain amount of time (depends on the company) and if an agreement is not reached, you should file a complaint at the state or federal level. My mother worked for one of the largest health insurance providers in the nation (they actually insure some of Disneys' employees) and the company absolutely stinks. They actually have eliminated thousands of jobs (my mother's being one of them) and are the most backwards, stupid insurance companies I have ever seen. And they STILL covered all my medications, all my doctors, etc. Nothing is perfect, and there are incompetent employees, and customers who will do anything to beat the system. We as the general consumer end up paying for it. It is important to understand how and why insurance can work for you (or cannot work for you) on an individual basis. It is important to understand your rights as a consumer and as a patient, and be prepared to speak up for those rights.

::climbs down off health insurance soapbox::

 

[The Mom]

I believe that the insurance problem has been exacerbated by developers building in areas that should not be developed.

When we moved here almost 25 years ago, I went to the historical societies in Duval, Clay, and St John's counties to see photos from hurricane Dora (the last hurricane to make landfall in this area, back in 1964)

I then made sure that we DID NOT buy a home in the areas that flooded. Believe it or not, those areas now have major population concentrations, malls,etc. Excuse me, but why would someone buy a million dollar house in MARSH landing??? Adjacent to the intracoastal...between the ocean and the river...in a SWAMP???

I'm just amazed at the building going on in the FLOOD PLAIN, which is basically most of St John's County, one of the fastest growing areas in the country. Not county...country!

So ALL of the residents of Florida are subsidizing homes in areas where NO homes should be built. Of course, most of Florida is not really suitable for homes. I'm not even sure that my 1913 home should really be here.

My insurance company has not increased rates significantly...yet.

 

[PigletIsMyCat]

The least of my problems are with my health insurance...I have Cigna through Disney.

I feel incredibly sorry for you. CIGNA is the company my mother worked for, and I know (firsthand) how idiotic those people can be.

As for what The Mom said about building in areas that shouldn't be built in, about a third of Manhattan island is built on landfills. They literally filled in the water with junk in order to extend the island. And out on the east end of Long Island, you should see some of the houses they build, out over the water practically on stilts. It's ridiculous that people want to live in a certain area or state so bad, that they would put themselves in harm's way.

 

[wedway71]

Yep!
In 2 weeks im moving from Cape Coral,FL(SW FLORIDA). Im sick of all the hurricanes and the jumps in insurance too.Moving to Indy and as sad as I will be to be far from WDW im glad I wont deal with another hurricane season.Not only is the insurance totally crazy its almost impossible for a middle class family to buy a home in Florida now.I bought my home brand new in Cape Coral 8 years ago for 85k-just sold it for 400k.
As far as the insurance deal-my new home owners insurance in Indy on my new home is $800 per year(THATS DAMAGE AND FLOOD!!) With the new price jump that would cost me more than a 20oz coke at Magic Kingdom

 

[Woody13]

I believe that the insurance problem has been exacerbated by developers building in areas that should not be developed.

When we moved here almost 25 years ago, I went to the historical societies in Duval, Clay, and St John's counties to see photos from hurricane Dora (the last hurricane to make landfall in this area, back in 1964)

I then made sure that we DID NOT buy a home in the areas that flooded. Believe it or not, those areas now have major population concentrations, malls,etc. Excuse me, but why would someone buy a million dollar house in MARSH landing??? Adjacent to the intracoastal...between the ocean and the river...in a SWAMP???

I'm just amazed at the building going on in the FLOOD PLAIN, which is basically most of St John's County, one of the fastest growing areas in the country. Not county...country!

So ALL of the residents of Florida are subsidizing homes in areas where NO homes should be built. Of course, most of Florida is not really suitable for homes. I'm not even sure that my 1913 home should really be here.

My insurance company has not increased rates significantly...yet.

Ditto Mom! :wave: When I bought my first house in Homestead, FL I made sure it was not in a flood plain and that it would survive a category 5 hurricane. The house was total CBS construction and all the exterior walls were filled with rebar and concrete. The entire roof was concrete as well. I had all the windows and doors ready to face any storm with a combination of Bahama shutters and plywood shutters.

We moved from south Florida in 1983 and we sold the house to a close friend. That house survived hurricane Andrew with only minor damage to the carport. Most other houses in the neighborhood were totally destroyed. When we moved to North Florida in 1983, the first thing I did was drop in to see the local State Farm Insurance Agent and I asked to see the flood plain maps for the area in which I was considering buying a new house.

In those days, flood plain maps were not generally released to the public and the agent was reluctant to share the information with me. I told him that I would not buy insurance from him unless I got to see those flood plain maps. He relented, although he refused to make me a copy. But after seeing the maps, I knew the areas which were out of the flood plain area and out of the hurricane surge area and I bought a house in a safe location.

Today, of course, flood plain maps are widely available to the public via the Internet and with GPS is easy to pinpoint property elevation. Yet, for reasons unknown to me, people still buy houses located in flood plains. Even worse, many people rebuild houses in flood plain areas. These same people buy insurance but all of us end up paying for their losses.

I paid about $1,300.00 a year for my homeowners insurance, until this year. Now I pay $1,600.00 a year plus about $120.00 surcharge to bail out Citizens Insurance. I just paid my annual premium last month. I own my house so I don't have house payments with an insurance and tax escrow account. When I still had a mortgage, the mortgage company required that I buy flood insurance as well, even though I don't live in a flood plain. I fought that requirement and I won. I haven't had flood insurance for over 20 years.

State Farm decided this year to eliminate mold and mildew damage from their standard coverage. You can buy an extra rider to cover mold and mildew, but I decided against it. Hell, I wouldn't trust any of those mold and mildew remediation and removal firms. I know how to do it myself. You just have to know what to look for (and where), and then eradicate the problem quickly (moisture) before it gets out of control.

 

[Hakunamatata]

Let me jump in on this band wagon, since I work for an insurance company, in fact am a second generation claims professional.

First, insurance is a business, say, just like Disney. They have stock holders, say, just like Disney. They are in business to make money, say, just like Disney, Walmart, McDonalds, Exxon, or your local doctor. If you live or drive your car in an area that is prone to suffer significant losses, you will pay more for your coverage.

Second, most insurance policies are contracts. For your premium, the company agrees to cover your risk of loss for a list of specified causes of loss. If you suffer a loss that is not listed, its simply not covered. No matter how long you have paid premium or been insured with the company.

Third, if we were to say, ok no more insurance, then, forget financing a new car, home, boat, etc. Then let the ripple effect go. Housing and auto industry would crumble, satalite business that are around to service housing and autos would crumble, Unemployment would rise. etc. etc.

And those who think they should not have to pay for other areas of the country that suffer catastrophe......thats the principle of insurance. Dont forget, one day that hurricane, earthquake, tornado, or flood may hit you and you will be standing there demanding that check that no bank in a hundred mile radius is open to cash. You will hope that all the people in the other parts of the country are paying their premiums too.

 

[Woody13]

And those who think they should not have to pay for other areas of the country that suffer catastrophe......thats the principle of insurance.

Writing a homeowners insurance policy in a known flood plain or a hurricane tidal surge area is the same as providing health insurance to Evil Knievel! I don't want to pay for reckless daredevils. :wave:

 

[Hakunamatata]

Writing a homeowners insurance policy in a known flood plain or a hurricane tidal surge area is the same as providing health insurance to Evil Knievel! I don't want to pay for reckless daredevils. :wave:

There are local companies that write only in specific areas. You have to do your research. You then run the risk of getting coverage through a small enough company that will go belly up the first cat 3 tornado that blows through.

Its a double edged sword.

 

[Woody13]

There are local companies that write only in specific areas. You have to do your research. You then run the risk of getting coverage through a small enough company that will go belly up the first cat 3 tornado that blows through.

Its a double edged sword.

Where I live, there are people that have million dollar houses built on barrier islands. It's not a matter of "if" these houses will one day be destroyed by a hurricane, it's just a matter of "when". Yet, State Farm and other companies write homeowner policies for these people. I end up paying for their mistakes!

I made it an important point when I purchased my house to make sure it was not in a flood plain or tidal surge area. Sure, my house is going to be exposed to high winds, but I have taken precautions to minimize that risk by strengthening the structure in key areas to avoid costly damage.

You can't prevent flood water or tidal surges from entering your home. Yet, people build and rebuild in these dangerous areas and the insurance industry seems to encourage the practice! I realize that flood insurance is handled by FEMA (for now) but current lawsuits in Florida may indeed make the insurance carriers face up to their responsibilities.

Many insurance companies in Florida walked away from their insured clients with the claim that "flood damage" (handled by FEMA) took precedence over "wind damage" claims. Therefore, if 99% of a house was destroyed by wind, yet 1 drop of flood water got in, the insurance carrier would deny the claim. The litigation in Florida goes on.

My solution to the problem is simple. Don't build in a known flood plain or tidal surge area. If you do build in those areas, then you must be self insured. I don't desire to share that kind of risk and I don't feel sorry for those people that live in such areas when disaster strikes. I have no sympathy for people that get in an auto accident and are not wearing their seat belts.

The insurance industry should not continue to insure high risk areas on my dime! My view of homeowners insurance is that they should provide catastrophic protect in the case of a major problem. Hell, I don't desire to nickel and dime them to death with small claims. I'll take care of the small stuff.

However, when the damage is major (due to a fire, hurricane, etc.) I expect rapid and expedient relief. I'm sorry to say that State Farm failed me after the damage from hurricane Ivan. The adjuster they sent (from Ohio) was a moron. To make a very long story short, I hired a public adjuster (and an attorney) to make State Farm live up to their responsibilities. I shouldn't have had to do that. :wave: