Many Florida homeowners hit with higher insurance premiums

State and insurers blame storms, litigation

Sharon Landry says she “freaked out” when she opened her statement and saw the premium for her homeowner’s insurance policy surge.

ORLANDO, Fla. – Sharon Landry says she “freaked out” when she opened her statement and saw the premium for her homeowner’s insurance policy surge.

Her policy went from $1,318 to $2,153 a year, a more than 60% increase.

“It kind of throws you into a panic mode,” Landry said.

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Landry says she has been in her Ocala home 17 years with only minor increases, and only one minor claim that happened years ago.

“I don’t think the insurance companies should be able to do this,” Landry said. “It’s just wrong. I mean, people are struggling to stay in their houses.”

Landry is by no means alone.

News 6 did some digging and found from January to September 2020, dozens of property insurance companies requested rate increases from the state, according to court filings.

Florida’s Office of Insurance Regulation approved nearly 100 rate increases involving dozens of insurers.

Many of the rate hikes are in the double digits.

No one from Florida’s OIR would go on camera, but spokesperson Karen Roach wrote in an email “Florida’s insurance market is one of the most complex in the world.”

“The property market is facing significant challenges, as the frequency of claims increases and those claims become more expensive,” she continued in an email.

The challenges are largely due to increased litigation, higher catastrophe claim losses as a result of multiple hurricanes over the past several years and rising reinsurance costs, according to the e-mail.

Reinsurance is insurance that an insurance company purchases from another insurance company to insulate itself from the risk of a major claim.

The insurance industry blames the 2017 and 2018 storm seasons.

Hurricanes Irma and Michael caused a reported $20 billion in damage.

Paul Handerhan is with FAIR, the Federal Association of Insurance Reform, a nonprofit that helps consumers with affordable rates.

“Florida is really suffering a crisis,” Handerhan said. “Florida insurers are definitely in a tenuous financial position right now.”

He says insurers are taking a hit even while raising rates.

“The vast majority of the insurers who are writing homeowner’s insurance in the state of Florida, have been posting underwriting losses for the last five years,” he said.

A mountain of lawsuits filed by contractors against insurance companies are driving the prices up, according to Handerhan.

Some companies and contractors advertise and patrol after storms, going door-to-door, suggesting to homeowners they could have damage and should file a claim, according to Handerhan.

If the insurance company doesn’t pay out the claim, the homeowner can sue, Handerhan said.

Often insurers will pay the claim to avoid the cost of litigation which can be much more expensive, he said.

“All consumers, me you and everyone else, we are paying for the activity of these roofers and other people that are going around and soliciting,” Handerhan said.

Landry did what all consumers should do.

She shopped around and found another company with the same coverage for $100 more per year. She did have to pay another $100 for wind mitigation, but it was still much less than the $800 plus her previous company was increasing her premium.

“People right now are struggling the most that they’ve ever struggled in this country for years,” Landry said speaking about the pandemic. “Now is not the time for the insurance companies to be taking advantage of these people.”

Historically the larger rate increases were on the coast, but we are seeing some areas hit with big increases for the first time.

Citizens Insurance, is run by the state, and is where people go when they can’t get insurance anywhere else.

Since 2015, Citizens has doubled the amount of policies they have in Orange, Seminole, Osceola and Lake counties.

About the Author:

Emmy Award-winning reporter Louis Bolden joined the News 6 team in September of 2001 and hasn't gotten a moment's rest since. Louis has been a General Assignment Reporter for News 6 and Weekend Morning Anchor. He joined the Special Projects/Investigative Unit in 2014.