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Fact file: Florida hurricane insurance

November 2020

  • Six of the 10 costliest hurricanes in U.S. history have impacted Florida. Three of these storms occurred within just two years: 2004 and 2005. (See chart.)
  • The costliest hurricane, based on insured property losses to Florida, was 1992’s Hurricane Andrew. It caused $25.9 billion in damage to Florida and Louisiana (in 2019 dollars). (See chart.)
  • Standard homeowners policies typically do not cover flood damage. Flood insurance is covered by the federally managed National Flood Insurance Program, but private flood insurance is becoming increasingly available.
  • Florida leads the nation in the number of flood policies, according to the National Flood Insurance Program, with about 1.8 million policies in force in 2019.
  • About 98 percent of the total population of Florida lives in one of the coastal counties. The number of people living in coastal areas in Florida increased by 4.2 million, or 27 percent, from 15.6 million in 2000 to 19.8 million in 2015, according to the U.S. Census Bureau.
  • In Florida, 2.9 million single-family homes were at risk in 2020 for storm surge damage from hurricanes up to Category 5 strength, according to CoreLogic, Inc. These homes would cost $581 billion to completely rebuild, including labor and materials.
  • After its establishment in 2002, when the state passed legislation combining two separate high-risk insurance pools known as the Florida Windstorm Underwriting Association and the Florida Residential Property & Casualty Joint Underwriting Association, Citizens Property Insurance Corp. (CPIC) experienced exponential growth. As a result, Florida Citizens has evolved from a market of last resort to the state’s largest property insurer.
  • Florida Citizens Property Insurance Corp. provides multiperil and wind-only insurance coverage to Florida homeowners, commercial residential and commercial business property owners.
  • Direct homeowners insurance premiums in Florida written by Citizens was $490.9 million in 2018 down from $795 million in 2014.
  • Citizens was the state’s fourth leading homeowners insurer in 2018, with a market share of 5.11 percent, down from 9.1 percent in 2014.
  • Florida Citizens had 346,227 policies as of March 31, 2020.

Get you homeowners insurance, flood insurance and auto insurance from Jones Family Insurance. Serving Port Charlotte, Punta Gorda, Cape Coral and Fort Myers Florida.

Preparing for Hurricane Season Flooding

Hurricane season is upon us and with these storms comes the threat of flooding. Unfortunately, tropical storms can also be unpredictable and their path, intensity, and possible damages are hard to determine ahead of time. The best thing you can do if you are in a hurricane risk area is to always be prepared for these storms and the flooding they can bring. We have some tips to help you keep your family and home stay protected this hurricane season.

Before the Storm

Know Your Risk – If you live in a state that has experienced hurricanes in the past, you are at risk of being impacted by one in the future. However, depending on where your home is located the risks are different. If you are located closer to the coast, your biggest concern should be storm surge. As we move more inland, your preparation should focus on heavy rainfall with wind gusts. Knowing which conditions of a hurricane are more likely to impact your property will help you properly prepare. It is also important to know the elevation of your property, which will directly affect your flood risk. You can visit www.myfloodrisk.org to check the flood risk factors of your home.

Insure Your Property – One of the most important steps to take before a storm is to review your insurance coverage to make sure you are protected from any damage a hurricane might bring. A standard home insurance policy will not cover flooding or storm surge, two of the most dangerous and destructive effects of a hurricane. A standalone flood insurance policy is needed to protect your assets. When a storm is forecast to make landfall in your area it becomes more difficult to find coverage, so it’s necessary to check your policies ahead of time.

 

Prepare Your Home – Flood waters are extremely damaging, but there are some things you can do to reduce the impact to your home. Clean out any drains and gutters on your property, this will allow water to flow freely through these systems. Sandbags can be used as a flood barrier by diverting water from flowing through openings and diverting flood water around the structure. To reduce damage to your belongings, lift all furniture from ground level using concrete blocks. It’s also important to make sure electronics are unplugged if they could come into contact with water.

 

Have a Safety Kit – Every hurricane season you should stock a safety kit to prepare for every scenario that could happen during a storm. You will need food and water, enough to last each household member at least a few days. Your kit should also contain flashlights, batteries, a portal cell phone charger and a battery-operated radio, so you can still listen to news reports should the power go out. Any first aid and personal hygiene products needed should be included as well. Important documents such as insurance papers and important personal documents should be stored in a watertight case such as your dishwasher or washing machine.

 

During and After the Storm

Stay Inside – Do not go outside during the hurricane or immediately after until your local authorities say it is safe and the storm conditions have passed. There might be damage outside that you are unaware of and wind gusts will continue from the outer bands of the storm, which could lead to debris becoming airborne. Also if it’s still raining there is always the risk of flash flooding, which is extremely dangerous to get caught in.

 

Don’t Go in the Water – Flood water is full of contaminants from debris, sewage, animals and other pollutants. It’s important to your health that you avoid flood water if possible. Hurricanes often lead to downed power lines and power outages, these powerlines can be hidden by flood waters and electrically charge the water.

 

Contact Jones Family Insurance. We service North Port, Port Charlotte, Punta Gorda, Cape Coral and Fort Myers Florida – If you have flood damage from the storm, contact us as soon as possible. Your JFI agent can help you with the claim process and what to do first to prevent further damage to your home.

Florida Homeowners Market Update

Another homeowners property insurance Home Insurance Quote company has filed a double-digit rate increase with Florida regulators while Citizens Insurance has begun tracking contingency fee multiplier litigation, one of the cost drivers behind rates.  Plus a great history lesson about Florida’s market to pass along.  It’s all in this week’s update.

Rate Increase:  First Community Insurance Company, part of Bankers Insurance Group of St. Petersburg has filed for a 24.1% statewide average rate increase on its 22,464 HO3 homeowners policies.   The Florida Office of Insurance Regulation (OIR) will hold a rate hearing on Wednesday (September 16) to consider the increase.

The company is among a growing number seeking double-digit rate hikes, brought on by the culmination of four factors we’ve outlined in the pages of this newsletter over the past 12 months: claims creep, growing attorney fees, rising reinsurance costs, and the resulting contraction of the private market with taxpayer-backed Citizens Property Insurance Corporation left picking up the policies.  Industry reports say similarly-sized increases are now permeating the commercial property insurance space.

Market Pressures:  Paul Handerhan, President of the Federal Association for Insurance Reform, recently provided a terrific education on how Florida’s insurance market has evolved since 1992’s Hurricane Andrew in this recent article.  He also explains the current-day litigation challenges that are putting upward pressure on homeowners rates.

Citizens:  Citizens Property Insurance Corporation has begun tracking lawsuits involving contingency fee multipliers.  While such fee multipliers used to be awarded only when a case was particularly complex and the plaintiff attorney showed it was a risky case to take on contingency, Citizens VP Elaina Paskalakis noted at a recent meeting that threshold has been eroded and is now easier to meet.

She put together the chart below of the most recent 12 lawsuits involving fee multipliers, some showing fees in excess of 1,000 or 2,000 times the indemnity ultimately paid in the case.  “The real impact is on fee demands.  Plaintiff attorneys are starting to come to us with higher fees and what they tell us they’ll be asking for in seeking multipliers.  We expect it will have a rather sharp impact on our cases going forward,” she told the Citizens Claims Committee.

Florida is the only state in the country that awards fee multipliers in such a way, due to a 2017 state Supreme Court edict (see How a $41,000 plumbing leak turned into a $1.2 million attorney fee).  Citizens Board Governor James Holton has aptly noted “this is the next great frontier for tort reform in Florida.”  We look forward to reporting on expected legislative developments in this regard.

Contact Jones Family Insurance for your homeowners insurance quote!

Florida Homeowners Market Update by Jones Family Insurance. Serving North Port, Port Charlotte, Punta Gorda, Cape Coral and Fort Myers Florida.

What is homeowners insurance?

Homeowners insurance is a type of property insurance that covers private residences. It offers financial protection in case of an accident, theft or disaster involving your home.

A standard homeowners insurance policy typically covers structural damage, personal belongings, liability and additional living expenses.

1. Structural damage

This is one of the key differences with homeowners vs renters insurance. In the case that your home suffers damage from theft, vandalism, or is destroyed by disasters such as fire, windstorms, hail, lightning or explosions, homeowners insurance can cover the costs of repairing or rebuilding it.

Your mortgage lender might refer to this as hazard insurance, but don’t let that trip you up. It’s just part of your homeowners policy.

Most policies also cover detached structures that are separate from your house, such as a garage or tool shed. These structures are generally covered up to a percentage of the insured value of your house’s physical structure, for example ten percent.

2. Personal belongings

Personal belongings that are stolen, damaged, or destroyed by an included disaster on your policy are typically covered. These may include:

● clothing
● furniture
● appliances
● computers
● TVs
● home decor
● wine and spirits
● sporting goods
● children’s toys
● electronics

Your level of coverage for personal belongings will generally be a percentage of the home’s insured value. So if where you reside is insured up to $100,000, and personal belongings coverage amount was to be 50 percent of this, the limit would be $50,000. The actual percentage used will vary from policy to policy.

Your homeowners insurance policy will also cover belongings that aren’t inside the property but included on your property: trees, shrubs, BBQ grills and patio furniture and so forth.

High-value items, such as jewelry, furs, artwork and antiques are usually covered in a standard policy. There are assigned dollar limits, so you’ll want to read the fine print.

3. Liability protection

Liability protection covers lawsuits against bodily injury or property damage that you, family members, or pets may cause to others. Such protection covers court costs and any awards you may have to pay in court.

Your policy also includes what’s called no-fault medical insurance. So if a visitor happens to be injured in your home, their medical bills can be paid by your insurance company.

4. Additional living expenses

Let’s say your house burns down and it’s now uninhabitable. While your home is being rebuilt, you’ll need to live elsewhere for a short while. Additional living expenses (ALE) covers any living away from home costs and eases the stress of being temporarily uprooted. These expenses may include lodging, meals at restaurants, storage fees, and other costs incurred while your place is being rebuilt.

And if you rent out part of your home, the amount you would’ve collected on rent while the home is being repaired would also be covered.

There are usually payout limits and time restrictions with ALE coverage. The good news is these caps are typically separate from your policy’s cap on repairing or rebuilding your house.

What won’t homeowners insurance cover?

A standard policy typically doesn’t cover wear and tear, or damage caused by an earthquake or flood. It also won’t cover mold if caused by say, high humidity or a preventable water leak.

Get your home insurance with Jone Family Insurance. Serving Punta Gorda and Fort Myers Florida.

Fact file: Florida hurricane insurance facts

June 2020

  • Six of the 10 costliest hurricanes in U.S. history have impacted Florida. Three of these storms occurred within just two years: 2004 and 2005.
  • The costliest hurricane, based on insured property losses to Florida, was 1992’s Hurricane Andrew. It caused $25.9 billion in damage to Florida and Louisiana (in 2019 dollars).
  • Standard homeowners policies typically do not cover flood damage. Flood insurance is covered by the federally managed National Flood Insurance Program, but private flood insurance is becoming increasingly available.
  • Florida leads the nation in the number of flood policies, according to the National Flood Insurance Program, with about 1.8 million policies in force in 2019.
  • About 98 percent of the total population of Florida lives in one of the coastal counties. The number of people living in coastal areas in Florida increased by 4.2 million, or 27 percent, from 15.6 million in 2000 to 19.8 million in 2015, according to the U.S. Census Bureau.
  • In Florida, 2.9 million single-family homes were at risk in 2020 for storm surge damage from hurricanes up to Category 5 strength, according to CoreLogic, Inc. These homes would cost $581 billion to completely rebuild, including labor and materials.
  • After its establishment in 2002, when the state passed legislation combining two separate high-risk insurance pools known as the Florida Windstorm Underwriting Association and the Florida Residential Property & Casualty Joint Underwriting Association, Citizens Property Insurance Corp. (CPIC) experienced exponential growth. As a result, Florida Citizens has evolved from a market of last resort to the state’s largest property insurer.
  • Florida Citizens Property Insurance Corp. provides multiperil and wind-only insurance coverage to Florida homeowners, commercial residential and commercial business property owners.
  • Direct homeowners insurance premiums in Florida written by Citizens was $490.9 million in 2018 down from $795 million in 2014.
  • Citizens was the state’s fourth leading homeowners insurer in 2018, with a market share of 5.11 percent, down from 9.1 percent in 2014.
  • Florida Citizens had 346,227 policies as of March 31, 2020.

Get your no obligation homeowners insurance quote at Jones Family Insurance. Serving Punta Gorda and Fort Myers Florida.