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Florida property insurance market remains shaky as new hurricane season begins

'I think the market could always be better,' Florida CFO Jimmy Patronis says
Posted at 5:50 PM, Jun 01, 2023
and last updated 2023-06-01 17:50:35-04

TALLAHASSEE, Fla. — As Florida recovers from last year's hurricane season, it now readies for another. The Legislature stepped up to help this lawmaking session, but is it enough as property insurance rates continue to climb and the market remains unstable? 

Last week, Gov. Ron DeSantis signed into law two disaster sales tax holidays worth $144 million.

On Wednesday, he signed an expansion of property insurance discount programs for homes shielded against the wind.

It comes as property insurance continues to weigh heavy on Floridians' wallets. Homeowners here continue to pay some of, if not, the highest rates in the nation. 

According to NerdWallet, the average cost of homeowners insurance in Florida is $2,385 per year or about $199 per month. This is 31% more than the national average of $1,820. Bankrate reports that the average cost of homeowners insurance in Florida is $1,981 per year for a $250,000 dwelling coverage policy. That's about 39% higher than the national average premium of $1,428 per year for the same amount of coverage.

The market remains shaky, as well, with companies still leaving. Velocity Risk Underwriters, LLC is the latest.

In a recent email, officials said "Effective 05/26/2023 Velocity will cease writing new business and will begin the process of exiting all homeowner programs." 

The company's departure follows multiple rounds of lawmaker reform to cut Florida's glut of lawsuits and bring in more competition to ease prices. Florida's Chief Financial Officer Jimmy Patronis (R) told us recently that he still had faith that changes would work given time.   

"I've got contacted by a number of investment groups that say, 'Hey, I want to come to Florida, I want to start up, I want to bring an insurance carrier there,'" Patronis said. "But these guys don't want to come here until November. You can't blame them— they're going to wait until after hurricane season."  

Others think an insurer accountability bill, also signed by DeSantis on Wednesday, will better protect consumers. It boosts penalties for bad actors and requires insurers to show their work when manipulating claims. 

However, former state Sen. Jeff Brandes, R-St. Petersburg, said the bill only reaffirmed powers Florida already has. 

"If the Legislature really wanted to do something strong to help the overall system, they would really help fund the Office of Insurance Regulation at the level it needs to be funded in order to regulate this market appropriately," Brandes said. "To me, that's the major thing they could be doing."

Lawmakers have already approved their budget for the upcoming fiscal year. Though DeSantis has yet to sign a major funding boost, regulators will likely have to wait for interest during the next session's budget discussions. The legislature returns for another sixty-day assembly in January.

Beyond policy, Florida officials have also posted a lot of help online. The CFO has a website with tips for creating a disaster plan and Florida's attorney general launched her latest Hurricane Preparedness Guide.