Florida is having a Homeowners insurance crisis. Many carriers have filed for bankruptcy, have left the state or are voluntarily shedding policyholders. Reasons are numerous and include: hurricane activity, climate change, can’t get the state to allow larger premium increases, legal actions, roof claims (many questionable), and rising reinsurance costs. Here are some things you may not know:
- If you are in the home buying process, secure your new homeowners policy early. Start the process of looking as soon as you sign the contract and secure it (get it bound) about two weeks ahead of settlement.
- New homeowners insurance cannot be bound some days ahead of an impending hurricane and sometimes right after a hurricane. After a bad storm anywhere in the state, insurance carriers may be closed for new business, days to weeks, while they are assessing their losses and damages, even if the storm wasn’t in your area.
- Hurricane Season in Florida runs June 1 to November 30.
- Insurance companies may have to do an inspection prior to effecting coverage and that inspection can include the interior of the home.
- Inspections are paying close attention to the age of the roof, age of the HVAC systems, and age of the hot water heater. Fifteen (15) years is usually the point where they require the roof to be replaced or an inspection showing that the condition of your roof has at least five more years of use.
- Insurance companies usually check a database for prior claims history. Your own prior claims history at your current (old) address and the prior claims history for the address of the home you are purchasing. If they find claims at your new home, they will want to verify that the repairs were done.
- Just because you have never had a claim with your current homeowners insurer doesn’t mean that they won’t/can’t cancel your insurance or won’t/can’t increase your premium.
- You should increase your deductible to the highest you can afford. It will save some premium dollars.
- You should consider not making small claims to your carrier. When carriers are looking to shed (cancel) policyholders, they look first to cancel those that have had claims and when you are trying to find a new carrier, some won’t write policies for those that have had prior claims.
- Independent insurance agencies usually have a handful of insurance carriers they are contracted with and may be your best bet for finding a carrier in our area. There are also direct writers (i.e. KIN), and company representatives (i.e. State Farm, Allstate). In addition, most have access to Citizens Property Insurance Corporation, the “FL company of last resort”.
- If you are not having success in finding an insurer, ask your real estate agent for a recommendation.