Current Events > Florida's Insurance Crisis Poses Yet Another Obstacle for Homebuyers There

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https://www.yahoo.com/finance/news/floridas-insurance-crisis-poses-yet-another-obstacle-for-homebuyers-there-160148941.html

Florida's insurance crisis is threatening the closing of Gernelle Bokuniewiczs clients for their dream retirement home in Winter Park, Fla.

Frustration began to brew when her client received a premium quote of $17,000 a year for homeowners insurance, even though the current owner is paying just $5,000 for the same coverage. Things got worse when the insurance company retracted its quote, citing the high risk associated with the property, leaving Bokuniewiczs clients scrambling for another insurer before the deal dies.

"I've run into issues before but nothing like this where I couldn't find any insurance for home," Bokuniewicz, the founder of Lively Real Estate, told Yahoo Finance. "It's pretty scary if there is nobody to provide insurance."

Thats becoming a bigger reality and problem for Florida homebuyers who typically must obtain homeowners insurance as a condition of a mortgage. But as multiple insurers pull out of the state altogether due to rising costs, thats getting harder to do at a reasonable price and as mortgage costs in general rise.

"[Homeowners insurance] has outrageous prices and trying to get coverage is a problem," Bokuniewicz said.

Floridians already pay the highest home insurance premium in the nation at an average of $6,000 a year in 2023, a year-over-year increase of 42% and 3.5 times higher than the US average of $1,700.

"If you were to go back to 2019, our average premium in this office was about $900 for a home," David Pojero, insurance agency owner based in Debary, Fla., told Yahoo Finance. "Its $2,400 today."

"It's quite a significant change in price," Pojero added.

Florida's insurance crisis can be attributed to the increase in reinsurance and litigation fees. Companies that cannot afford the rising prices either leave the state or pass down the cost to consumers.

The state recently repealed a long-standing provision called the one-way attorney's fee that requires insurers to pay a reasonable amount of litigation fees for policyholders if they secure any amounts against the insurance company. Legislators saw this as a way to reduce insurance costs, although Floridians may face a financial burden when going after insurance companies for claims.

"This is definitely one of the harsher things that's hitting the Florida real estate market right now," Pojero said. "Insurance costs are so high so it's almost like a risk of how high your payment can go."

Reinsurance, essentially an insurance company's insurance, surged as hurricanes increased in frequency and severity in the state. Reinsurance rates escalated 45% to 100% in January 2023, and another 20% to 40% in June after Hurricane Ian caused almost $114 billion in inflation-adjusted costs.

"There is a lot of unpredictability when it comes to weird kinds of anomalies storms and fires and all kinds of stuff especially here where our biggest issues obviously are going to be hurricanes or wind storms," Pajero said. "So when there is a lot of uncertainty, a reinsurance company will plan for the worst and hope for the best and jack the pricing up."

In tandem with soaring premiums, insurance companies are cracking down on policyholders.

The house in Winter Park that Bokuniewicz represents was deemed uninsurable due to four prior insurance claims both the buyers and homeowners made.

Im sure the conservatives will fix the climate disaster causing this if we keep giving them more chances and keep voting them in

/s since some people wont understand without that

Republicans won't fix this crisis and definitely won't try to mitigate the underlying issue to these increasingly extreme weather events.

Why isn't the DOJ or whoever investigating insurance companies in Florida?

Have the fixed the dumb roof rules yet that favor roof replacement over just a repair?

never going complain about high my insurance is for a bit. Florida getting screwed hard.

the question is how do you fix this problem exactly? Florida gets hit at once a year it feels like, and they been destroying their natural barriers. The only company making money down there is construction and repairs, and thats questionable.

texanfan27 posted...

never going complain about high my insurance is for a bit. Florida getting screwed hard.

the question is how do you fix this problem exactly? Florida gets hit at once a year it feels like, and they been destroying their natural barriers. The only company making money down there is construction and repairs, and thats questionable.

So long as Republicans are in charge, things will never get fixed.

So, what's going on here?
Florida's always been hit by hurricanes. Feels like the past several years haven't been anything out of the ordinary, they've been pretty lucky considering how warm the ocean's gotten, if anything.
So why are prices skyrocketing?
Is it speculative? Costs haven't gone up that much YET, but are expected to in the near future so they're demanding more now in prep for it?
Is it b/c so many have moved to Florida that the same 10 square miles that gets hit directly by a hurricane now has 2x as many houses in it to cover?
Are the prices of the homes going up so much that it just costs several times as much to repair/replace them as before?

Like...I'm all on the fuck DeSatan train and FL hasn't done shit about climate change for decades, but... the rate increases just seem out of line compared to the amount of hurricanes they get now vs. 10 or 20 years ago....

Im sorry, Florida will not only always suck but will continue to get worse under the Republicans

They voted for this. Fuck'em.

[LFAQs-redacted-quote]

Its because all the fucking old republicans from blue states keep moving here and have been for decades. New York: please stop shipping your trash to my state

SuperShake666 posted...

They voted for this. Fuck'em.

Fuck off, I did not vote for this

Shame. Winter Park is nice tho

SimulationSwarm posted...

Fuck off, I did not vote for this

You did at least vote against the GOP, right?

VGAddict90 posted...

Why isn't the DOJ or whoever investigating insurance companies in Florida?

investigating them for what?

you cant force them to do business in a state if they dont want to

Cars too. Car insurance in FL is way higher than a car payment.

Time to nationalize all insurance companies.

Humble_Novice posted...

You did at least vote against the GOP, right?

1. Fuck off
2. Yes