Florida Hurricane Home Insurance: Bracing for the Worst

A single family home that is inside the FEMA maps special high risk flood hazard area is seen beside the waters of Biscayne Bay in Miami Beach, Fla., on April 1, 2015. Joe Raedle/Getty Images

News Analysis

If you’re thinking of moving to Florida anytime in the next year, you might want to bring an extra calculator and an attorney.

In the wake of hurricanes Helene and Milton, home insurance across the state is about to increase—and unless the insurance markets get some form of miraculous relief in the next few months to handle claims, experts are expecting rates across the board to reach new highs.

“There is hope, but it’s not looking that great,” said Jon Moller, vice president of condominium insurance association sales with Brown & Brown Insurance in Fort Lauderdale, in a Virtual Webinar on Oct. 25.

“We’re waiting for the data to come in to see how much damage has been done to these associations and how much insurable damage that these insurance carriers will have to pay out.”

The new rates aren’t expected to be in place until the New Year, but Moller believes every area of Florida is going to be affected.

“The West Coast is probably going to be much higher with massive rate increases. It could go up as much as 20–30 percent,” Moller said. “But each area will have its own increase.”

Payouts for recent home damages are another concern.

Consider, for example, Citizens Property Insurance Corporation, headquartered in Tallahassee in the Florida panhandle.

Citizens is currently the state’s largest insurance provider, with more than 1.27 million policies in force as of Oct. 18, 2024.

Total underwriting expenses in 2022 alone amounted to more than $4.3 billion.

Citizens was created by the Florida Legislature in 2002 as a not-for-profit alternative insurer whose public purpose is to provide insurance to, and serve the needs of, property owners who cannot find coverage in the private insurance market.

Moller pointed out that in the wake of Helene and Milton, most claimants aren’t likely to see a penny of claim insurance money.

“Citizens actually denied 75 percent of the claims that came through from Hurricane Debby [in August],” Moller said. “And they’re guessing that it’s going to be about the same with Hurricane Milton and Hurricane Helene.”

Jordan Knowles, senior vice president with Brown & Brown, said that escalating home building costs have also become a factor.

“What was a $400,000 claim is now a $1 million claim,” Knowles said. “And carriers aren’t paying out a lot of claims.”

While this is not good news for homeowners, insurance companies and associations that come to Florida often find it tough to stay in business.

Based on a 2023 report by Insurify, an American insurance comparison shopping website in Cambridge, Mass., more than a dozen home insurance companies in Florida have declared insolvency since 2019—despite the fact that state homeowners pay the highest premiums in the United States—with an average annual rate in 2023 of $10,996, far ahead of second-place Louisiana.

These costs were already projected to increase in 2024, but James Schumaker, executive vice president with Castle Group, a property management group in Plantation, Fla., thinks the next rates might push homeowners and insurers to a breaking point.

“We’ve had two major back-to-back powerful hurricanes hit our state, and those effects are likely to have another negative impact on our homeowners and associations,” Schumaker said. “So I hate to say it, but tough times are likely ahead.”

However, Schumaker and other colleagues specified a number of options that Florida homeowners can employ to not only guard against hurricanes but to qualify for lower insurance premiums.

Knowles, Moller, and Joshua Krut, a partner with Kopelowitz Ostrow law firm in South Florida, recommended these steps to procure an ‘A’ rating on your home or building:

1. Have impact doors and windows installed to automatically receive a large credit on your association’s policy. Also, consider storm shutters, which add an extra layer of protection.
2. Perform a wind mitigation inspection.
3. Conduct a building insurance appraisal every 36 months.
4. Make sure your home has roof snaps.
5. Invest in an asphalt roof because “carriers like asphalt roofs better than metal,” Moller said.
6. Detail and keep a record of all repairs you make, especially if they are claims-related, and keep the information in an easily accessible place. Otherwise, as Knowles indicated, you might be “crossing yourself off from getting a quote” from even one carrier.
7. Speak with an attorney to make sure you are correctly performing all repairs and protections.

“Communities that have the protection are doing a lot better in terms of their insurance premiums, and they’re getting coverage with better carriers,” said Krut—adding that perhaps the most critical factor to handling home insurance going forward will be in seeking professional guidance.

“It’s important to speak with both agent and attorney in terms of figuring out your policy and coverage that you’re going to obtain for the next year,” Krut said.

“There are pretty strict requirements under the Florida statutes, and there may be some creative ways to address issues that you may not have thought of in terms of assessments, budget amendments, and maybe document amendments to shift some of the coverage burden. Don’t try to go it alone.”