Florida residents pay twice the national average for homeowners insurance according to the Florida Chamber Foundation, and the risk for catastrophic hurricanes may be to blame.
East Bay Insurance Agency Principal John Hays handles thousands of homeowners’ insurance policies throughout the state of Florida. He said although the system is complex, the level of risk in an area can greatly affect costs.
“We have a unique catastrophic exposure that many other places may not have,” he said. “Each area has its own unique issues. It’s not as easy as ‘well our rates are higher than the rest of the country.’ It’s much more complicated than that.”
Homeowners’ insurance rates shot up after the 2004-2005 hurricane season. In 2004 the state took damage from hurricanes Charley, Frances, Ivan and Jeanne. In 2005 season, Florida took another beating from Dennis, Katrina, Rita and Wilma. These eight hurricanes caused destruction, and insurance claims from the Panhandle to the Keys.
“Those two years decimated the Florida insurance market,” Hays said. “The years 2004 and 2005 changed the world for Florida insurance.”
Other factors, Hays points out, can also drive rates up. The states of aging homes and sinkhole risks also have a hand in premium prices.
Read the full article in the June 16 issue of Navarre Press. Click HERE to subscribe to your community newspaper.