Some billionaires in the state are paying as much as $622,000 per year for property coverage.
Florida’s mega rich may own massive properties and huge mansions, but this doesn’t mean that they are able to escape the skyrocketing homeowners insurance premiums the state has been facing.
In fact, billionaires in the state are paying hundreds of thousands of dollars for their coverage.
According to a recent Bloomberg report, owners of some of the largest mansions and properties in the state are paying massive homeowners insurance premiums every year. The report pointed specifically to Star Island, the most exclusive zip code in Miami, where stars such as Sean “Diddy” Combs, Jennifer Lopez, Ken Griffin and Alex Rodriguez live. In that zip code, the annual premiums are a tremendous $622,000 per year.
As is the case for property owners throughout the rest of the state, that rate is a striking increase over what was being paid last year. According to the report, Star Island saw its premiums increase by about $200,000 since last year.
While that is an eye-opening increase, experts say that it can be justified by the high cost of the homes and their contents, as well as the rising risk of hurricanes and other severe weather in addition to the recent rapid inflation and growing cost of home repairs, construction and property replacement.
Climate change is contributing to the increasing homeowners insurance premiums of everyone in Florida.
Florida has been affected by a number of damaging hurricanes in recent years, and climate models indicate that these storms will only continue to be more frequent and severe. This, combined with the rising prices of construction, consumer goods and virtually everything else mean that the cost of the claims associated with those storms is rising, and rates are being hiked to compensate for that trend.
That said, homes with a value higher than $1 million in the state are seeing their homeowners insurance premiums rise faster than more modestly-valued properties, according to the Bloomberg report. What’s more, in many cases, despite the rate hikes, many plans are offering less coverage than they would once provide.