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Why your homeowner’s insurance policy rate shot up and what you can do about it


Updated: 1:32 PM EDT May 19, 2021

If you got a surprise when you opened your homeowner’s insurance policy this year, you are not alone.

Lawmakers, insurance companies and agents all agree, Florida’s insurance industry is in crisis.Advertisement

The rates are going up as much as 70% in one year, with agents reporting some people are saying they will have to sell their homes. 

Part of the reason — hurricanes. But many people, like Jim Brown, have never put in a claim for damages, so were shocked when they got their new insurance rates.

“Shock and awe. I was a little bit set back by it, ” Brown said.

Brown’s rate jumped from $8,044 in 2018-19 to $11,702 in 2020 — a 45% increase.

“I was shocked — I couldn’t believe the rates had jumped that much,” Brown said.

Brown said his company told him he had been undercharged in the past and that’s why it jumped so high.

But the West Palm Beach homeowner is still just one of many calling their insurance agent in disbelief.

“You’re getting angry, ‘I haven’t had any claims — why is this happening to me?'” said Greg Buck, owner of National Risk Experts in Palm Beach Gardens.

Buck said the typical homeowner’s cost has gone up from 20-70%. 

“We’ve got the worst market I’ve seen in 30 years,” he said. 

The reason? Some of it is because of years of catastrophic hurricane-related claims, like from Hurricanes Michael and Irma, but also insurance companies themselves are facing skyrocketing reinsurance costs by the companies that back them up financially.

And then, there’s plain old fraud.

“We have some pretty unscrupulous people who go around to people’s homes and say I’ll help you with getting a new roof,” state Senator Lori Berman said.

Berman said fraud and lawyers suing the insurance companies have also helped lead to the astronomical increases in rates.

“Absolutely, it’s a huge problem here in the state and we’ve got to do something about it,” said Berman.

Listening to complaints from the insurance companies and from homeowners, Florida lawmakers just passed a hotly debated bill making it harder to file a fraudulent claim, and reducing the time you can put in a claim from three years to two.

Berman didn’t vote for the bill, though, she tried to pass an amendment that would freeze rates for six months. 

“If you think this bill is going to lower costs let’s put that into the law, but they didn’t feel confident enough to put that into the law, which is really concerning to me,” she said.

Berman said rates may continue to rise.

Buck said your best bet is to contact a reliable agent and get a free policy review. That’s what Brown did: by reinforcing his old roof and getting a new inspection, he was able to shave a few thousand dollars off his rate — just a little bit of satisfaction.

“Satisfactory to me would have been the old rate,” Brown said.

In earlier drafts of Senate Bill 76, the bill let insurance companies pay only part of the cost of a new roof if it were older than ten years. That part did not make it into the final bill, and partly because of it, insurance companies are warning rates will continue to rise.

Both the bill and a companion House bill are now on Gov. Ron DeSantis’ desk for signing into law.

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