JR AND SMILEY CHARLES. A LOST CAUSE. THAT’S PRETTY MUCH WHAT ONE EXPERT GROUP IS SAYING ABOUT THE COST OF HOME INSURANCE IN FLORIDA AFTER TWO SPECIAL SESSIONS LAST YEAR AIMED AT LOWERING RATES. THEY JUST KEEP SKYROCKETING. WESH 2’S ANIKA HOPE FOUND OUT WHAT’S HOLDING UP ANY KIND OF RELIEF THE STATE OF THE PROPERTY MARKET TUESDAY, FLORIDA LAWMAKERS MET TO TALK ABOUT WHAT THE PROPERTY INSURANCE MARKET LOOKS LIKE ALMOST ONE YEAR AFTER THE SPECIAL SESSION WHEN THEY TRIED TO FIX MANY OF ITS PROBLEMS ON THE STATUS OF FLORIDA’S PROPERTY INSURANCE MARKET. BUT A STUDY JUST RELEASED BY AN AUTHORITY IN RISK ASSESSMENT SUGGESTS HOMEOWNERS MAY KEEP FEELING THE SQUEEZE OF RISING COSTS FOR YEARS. AND THEIR CONCLUSION WAS NO, THAT WHILE THERE WILL BE IMPROVEMENTS IN THE MARKET DUE TO THE CHANGES, PARTICULARLY IN ONE WAY ATTORNEY FEES BEING ELIMINATED AND THAT WILL HELP THE LEGAL SYSTEM ABUSE ISSUES. BUT IT DOESN’T NECESSARILY EQUATE TO LOWER RATES. THE STUDY FOUND THAT WHILE LEGISLATION IS EXPECTED TO HELP LESSEN FUTURE PREMIUM INCREASES, FLORIDA HAS TOO MANY OTHER FACTORS THAT MAY WIPE OUT ANY COST CUTTING. NOW, ANALYSTS POINT TO CLIMATE RISK WITH AN INCREASING SEVERITY OF HURRICANES AND INCREASING LOSSES FROM NON-HURRICANE STORMS. DEMOCRATIC STATE REPRESENTATIVE ANNA ESKAMANI SAYS THERE’S MORE TO BE DONE. I DON’T THINK IT’S SMART POLICY THAT WE JUST KEEP REBUILDING IN IN THE SAME AREA THE SAME WAY. IF YOU ARE GOING TO BUILD IN VULNERABLE AREAS, THEN YOU NEED TO REEVALUATE YOUR BUILDING CODES. RESEARCHERS ALSO FOUND THAT THE AVERAGE COST OF CONSTRUCTION IN FLORIDA HAS GONE UP BY ABOUT 40% SINCE 2017, AND THAT’S BOOSTING PREMIUMS, TOO. REPUBLICAN REPRESENTATIVE RANDY FINE ARGUES THIS HAS TO BE ADDRESSED AT A FEDERAL LEVEL. IF INFLATION MAKES YOUR HOUSE, IF INFLATION MAKES CONSTRUCTION MATERIALS COST TWICE AS MUCH AS THEY USED TO COST, THEN REBUILDING YOUR HOUSE WILL COST TWICE AS MUCH AS IT USED TO COST. AS A RESULT, INSURANCE WILL COST TWICE AS MUCH AS IT USED TO COST. ANALYSTS FOUND THAT THE COST OF REINSURANCE WHAT HELPS PROTECT INSURANCE COMPANIES IS ULTIMATELY HITTING FLORIDIANS HARD, TOO. REINSURANCE COSTS HAVE GONE UP ON AVERAGE ABOUT 40% THIS YEAR. NATIONALLY. BUT ACCORDING TO KAREN CLARK’S ANALYSIS, THEY INCREASED AS MUCH AS 100% FOR SOME FLORIDA INSURERS, THAT IS A PASS ALONG COST TO CONSUMERS. THE STUDY NOTED A PATH FORWARD, THOUGH, RECOMMENDING TOUGHER BUILDING CODES, RETROFITTING EXISTING PROPERTIES AND INCREASING LAND USE PLANNING, ALL TO HELP LOWER THE RISK AND EVENTUAL
Study says lowering risks is path to lower property insurance premiums
Updated: 11:25 PM EDT Oct 10, 2023
Nearly a year ago, Florida lawmakers held a special session designed to address the state’s property insurance crisis.Tuesday, lawmakers got together again to hear how it’s all working out.However, a study just released by a major risk assessment company concluded that consumers may not see lower premiums for a while.”So even with the significant reforms that were passed by the legislature here in Florida, when you have these macro factors in play, there’s just not a path to lower rates,” Mark Friedlander of the Insurance Information Institute said.Researchers labeled those costly factors as the following: the increasing severity of hurricanes, increasing losses from non-hurricane storms, inflation and rising construction costs, lingering effects of excessive litigation, and the soaring costs of re-insurance, which covers insurance companies, passed along to consumers.Researchers suggested, though, that without the recent legislation, many Florida homeowner’s premiums would be even higher.Related: More Florida homeowners are self-insuring amid rising insurance costs, survey says”If inflation makes construction materials cost twice as much as they used to cost, then rebuilding your house will cost twice as much as it used to cost. As a result, insurance will cost twice as much as it used to cost,” Republican state Rep. Randy Fine said.Fine said economic factors must be tacked at the federal level.Democratic state Rep. Anna Eskamani agrees more has to be done but points to policy reform regarding climate change.The report did reflect on a path to someday cutting consumer costs by first reducing the climate risks for Florida’s increasing population and coastal communities.Related: Progressive to send non-renewal notices to 115,000 Florida home insurance policyholdersThe analysis recommended tougher building codes, retrofitting existing properties, and increasing land use planning.”When you look at what buildings were still standing, you know, after Hurricane Harvey and others, there are buildings that were built at a much more recent time because their building codes were stronger, and we can strengthen those even more so. And again, we can also help incentivize Floridians to retrofit their homes,” Eskamani said.The next session for lawmakers to tackle all of these property insurance problems starts in January.Top headlines:Listen to news and weather headlines with the WESH 2 podcastMan, woman dead in Pine Hills shootingAt least 5 hurt when panic leads to stampede at pro-Israel vigil at Florida college
Nearly a year ago, Florida lawmakers held a special session designed to address the state’s property insurance crisis.
Tuesday, lawmakers got together again to hear how it’s all working out.
However, a study just released by a major risk assessment company concluded that consumers may not see lower premiums for a while.
“So even with the significant reforms that were passed by the legislature here in Florida, when you have these macro factors in play, there’s just not a path to lower rates,” Mark Friedlander of the Insurance Information Institute said.
Researchers labeled those costly factors as the following: the increasing severity of hurricanes, increasing losses from non-hurricane storms, inflation and rising construction costs, lingering effects of excessive litigation, and the soaring costs of re-insurance, which covers insurance companies, passed along to consumers.
Researchers suggested, though, that without the recent legislation, many Florida homeowner’s premiums would be even higher.
Related: More Florida homeowners are self-insuring amid rising insurance costs, survey says
“If inflation makes construction materials cost twice as much as they used to cost, then rebuilding your house will cost twice as much as it used to cost. As a result, insurance will cost twice as much as it used to cost,” Republican state Rep. Randy Fine said.
Fine said economic factors must be tacked at the federal level.
Democratic state Rep. Anna Eskamani agrees more has to be done but points to policy reform regarding climate change.
The report did reflect on a path to someday cutting consumer costs by first reducing the climate risks for Florida’s increasing population and coastal communities.
Related: Progressive to send non-renewal notices to 115,000 Florida home insurance policyholders
The analysis recommended tougher building codes, retrofitting existing properties, and increasing land use planning.
“When you look at what buildings were still standing, you know, after Hurricane Harvey and others, there are buildings that were built at a much more recent time because their building codes were stronger, and we can strengthen those even more so. And again, we can also help incentivize Floridians to retrofit their homes,” Eskamani said.
The next session for lawmakers to tackle all of these property insurance problems starts in January.
Top headlines:
Alice J. Roden started working for Trending Insurance News at the end of 2021. Alice grew up in Salt Lake City, UT. A writer with a vast insurance industry background Alice has help with several of the biggest insurance companies. Before joining Trending Insurance News, Alice briefly worked as a freelance journalist for several radio stations. She covers home, renters and other property insurance stories.