More Florida insurance companies could go belly up in the next 18 months.
It’s a prediction being made by many insurance industry experts and it’s scary news for everyone who is already struggling with insurance rate hikes or even finding a company to insure them.
However, the insurance companies themselves are dealing with rate hikes too. It’s called re-insurance.
That’s insurance for the insurance companies. The new rates for those companies are expected to come out in June and they could be so large that some companies won’t be able to afford them and could risk going out of business.
The insurance industry has experienced a meltdown in recent years and it has only grown worse since Hurricane Ian and Nicole in 2022. As companies have dissolved and prices have been shooting up tens of thousands of policies have been cancelled.
Consumer Watchdog Doug Quinn, with the American Policy Holder Association, said the market has been in complete chaos for the last two years. He is among those predicting more companies will dissolve after re-insurance rates come out in June.
“I’d say it’s a certainty in the next 18 months. We’ve seen a significant amount of companies go out of business already,” Quinn said.
In fact, seven companies including UPC and St. John’s have gone insolvent in the last year in Florida.
Local business and homeowner Cole Peacock of Fort Myers believes the legislature can do a much better job of getting a handle on the insurance industry.
Insurance Commissioner Mike Yarowsky insists changes made this year by lawmakers will take time.
“We’re probably looking about 12 to 18 months before we really have the experience to show what the legislature has done,” Yarowsky stated earlier this month.
But that kind of time may not be on the side of some insurance companies.
Reid McDaniel with McDaniel Insurance Solutions, which helps people find insurance, said there are a few carriers in the Florida market that have already seen red flags and surplus dips that make them more vulnerable.
Leaving certain more cancellation notices are coming which will leave more homeowners with fewer options. Many of them could be forced into the insurer of last resort, state-run Citizens insurance.
The company said Thursday it is prepared to handle any additional customers it takes on; however, it warns there could be consequences.
“Citizens is designed to respond to market conditions and take on policyholders who cannot find coverage in the private market. As our policy count increases, however, the risk of having to levy assessments on our policyholders and other Florida consumers increases,” said Michael Peltier of Citizens Insurance.