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Light at the end of the tunnel: Recapping the Florida Property Insurance Market Update for May 2024

 

June 12, 2024

Joe Nelson, Agent

 
Florida Property Insurance Market Update - June 2024


View from inside a dark tunnel with a beautiful picturesque Florida scene at the end. The scene features a sunny beach with palm trees and a bright blue sky, highlighting hope and new beginnings.
The light at the end of the long and dark road Florida Insurers and Homeowners have been on

Hey Floridians! Here’s the latest scoop on the property insurance market in our sunny state. The Florida Office of Insurance Regulation (OIR) has released its May 2024 update, and there's a lot of good news to share. Here’s what you need to know.


Stabilizing Rates


For the first time in years, we’re seeing a trend towards stabilization in property insurance rates. This means no major increases on the horizon. In fact, ten companies have filed for no increase, and eight are even planning to reduce rates in 2024. This is a clear sign that the market is calming down after a rocky period.


Reinsurance Relief


Reinsurance—essentially insurance for insurance companies—has become more accessible and affordable. This is crucial because the cost of reinsurance directly affects your insurance premiums. The positive response from the reinsurance market is a testament to the effectiveness of recent legislative reforms.


Improving Financial Health


Florida’s insurers are bouncing back financially. After several years of losses, many companies are now reporting profits. This is great news because financially stable insurers mean more options and better rates for consumers. Citizens Property Insurance Corporation, the state-backed insurer, also reported a substantial surplus increase and a significant drop in policy count.


Legislative Reforms


Recent legislative changes have been pivotal in curbing abusive litigation practices, which were driving up costs. In 2022, although Florida had only 14.9% of the nation’s homeowners’ claims, it accounted for 70.8% of the litigation. The reforms aim to reduce this disparity by cutting down on unnecessary lawsuits and encouraging fair claim practices.


New Players in the Market


Eight new insurance companies have been approved to write homeowners’ policies in Florida, bringing more competition and hopefully better rates. Notable names like Manatee, Mainsail, and Orion 180 are now part of the market.


Citizens Depopulation Success


Citizens Property Insurance Corporation has successfully reduced its policy count. This is a good sign of a strengthening private market. Over 650,000 policies were assumed by private companies in 2023, an 800% increase from 2022. This move helps reduce the potential financial burden on all Floridians in case of a major disaster.


Support for Homeowners


The state is also helping homeowners make their properties more resilient. The My Safe Florida Home Program has received $350 million in funding over the past three years to assist with home improvements that can lower insurance costs.


Looking Forward


Florida’s property insurance market is setting an example for other states dealing with similar issues. Legislative reforms here are being watched and potentially adopted by states like Hawaii, Georgia, and Louisiana.


The OIR is committed to continuing its market research and collaborating with universities to find innovative ways to improve our insurance market. This ongoing effort aims to keep the market stable and beneficial for both insurers and policyholders.

For more detailed insights, you can check out the full report from the Florida Office of Insurance Regulation. Here’s to more stable and affordable insurance rates for all!


Source: Florida Office of Insurance Regulation Market Update, May 2024​​.

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