Home insurance crisis: What’s the status of Florida’s market 1 year after insolvencies?

TAMPA, Fla. (WFLA) — Florida homeowners are still getting hammered by rising insurance rates, but there are some signs of relief. More companies are open for business and fewer are folding. In some cases, there’s less-frequent assessments too.

Investigator Mahsa Saeidi is still getting daily emails about the impact of this crisis. As the year comes to a close, 8 On Your Side is checking the pulse of the market.

“Failing I think is just not an option,” Gov. Ron DeSantis said during a news conference in May 2022. “We did a package last year that had some good stuff…but it just didn’t do enough I think to really stabilize this situation.”

Flashback to last year, Florida insurance companies like Avatar, Weston, Southern Fidelity, Lighthouse, St. Johns and FedNat were sinking like bricks. 8 On Your Side was getting frantic calls from folks who were losing their insurer.

“They just can’t cancel our policy the night before a hurricane is going to make landfall,” said Tom Colantuono. “My wife was sitting in the car, she was white as a ghost.”

But when a company fails, current customers aren’t the only ones who take a hit.

The state, through the Florida Insurance Guaranty Association (FIGA), takes over remaining claims. If the company can’t pay up, that cost gets passed down to homeowners. It’s called an assessment.

And over the past two years, homeowners have had four separate charges on their property insurance bill.

“FIGA is a good indicator of the health of the market,” said FIGA’s Executive Director Corey Neal.

There’s some positive signs coming from FIGA. Neal said there’s just a single assessment left, its 1% annual surcharge on your premium.

“The average premium is $4,500, so we’re talking $45 a policy,” said Neal. 

Neal said he’s thankful that the insolvencies have slowed down. 

“Very thankful it’s been a long, long few years,” he said. 

The last one was massive. When St. Pete-based UPC went under in February, FIGA had to pick up the tab for approximately 23,000 claims.

Now, FIGA has closed four of five claims, paying out over $300 million.

Neal encouraged homeowners with open cases to get involved with the claim. He said you should stay in touch with your adjuster or attorney.

“What is FIGA offering? What are we demanding? How are we going to reconcile the difference?” Neal said. “These are the more complex claims but our strategy doesn’t really change, we’re looking to settle.”

Neal said he’s hoping the calm phase continues.

“The last heavy activity we’ve had was in 2008,” he said.