As the state sinks further into a coverage crisis, the insurer of last resort’s use is ballooning.
The recent inflation and regular severe hurricanes have caused massive home insurance challenges in Florida, forcing many homeowners to turn to the insurer of last resort, Citizens Property Insurance, for coverage.
Lawmakers have been working to change regulations to dig out of the crisis, but the crisis is continuing.
Both availability and price of home insurance coverage is becoming increasingly problematic in Florida, to the point that many property owners don’t have any choice but to fall back on Citizens.
“Unfortunately, we’re still in crisis mode,” said Mark Friedlander from the Insurance Information Institute (III).
According to the III, litigation issues have compounded the problems with increasingly frequent and severe storms. This has caused rates to spike and has led insurers to restrict to whom they will provide coverage. While Citizens is supposed to be a safety net of last resort, the state backed insurer has become the only option for a rising number of Florida residents.
Citizens is providing many homeowners with the only affordable home insurance policy available to them.
“Citizens is going to be significantly less costly than a private insurer. In fact, in many cases, it could be 50 percent lesser than the premium you would pay on the private market,” explained Freelander.
“As companies leave the state or make their policies more restrictive, they come to us,” added Citizens Property Insurance spokesperson Michael Peltier. “We have probably tripled our policy count in the past 14 months.”
In the past, this trend has come and gone among property owners living in coastal communities that are the most vulnerable to extreme storms like hurricanes. However, the current crisis has also sent large numbers of property owners from central Florida around Orlando to need the same coverage of last resort.
Since the start of last year, the number of Citizens customers from Seminole County has exploded from slightly more than 4,000 to just shy of 14,000. Similarly, Orange County’s number leapt from 14,500 to 37,000, Lake County’s customers rose from 3,592 to 9,105, and Osceola County bumped up from 6,136 to 14,532.
