Taking Stock of Changes in Insurance


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Abora Julie A MartinBy Julie A. Martin

2023 has been a strange year for insurance in the state of Florida. We have seen some massive increases in premiums across the board. Home, Auto and Flood insurance premiums have risen above levels seen last in 2005. Between 2022 and 2023, nearly 20 carriers either went into receivership or left the Sunshine State entirely due to the high incidence of claims and litigation.

Now that it has been nearly a year since litigation passed, changing the way property damage attorneys are paid in the event of a disagreement, from carrier-paid to contingency paid, what does this mean for insureds whose claims were either denied or underpaid? Does the litigation help? Will there be relief?

These are all good questions. When an attorney takes a case on a contingency basis, it generally means that in return for their help in resolving a case, they will take a percentage of the case value. If you had a $100,000 property damage claim that should have been covered, and the attorney recovered the entire $100,000, whatever set percentage you agreed to at the outset of the lawsuit will belong to the law firm. Generally, the percentage is 33% or roughly 1/3 of the total claim payment.

Some of the rates are starting to decrease. Citizens Property Corp. Depopulation program has two types, voluntary and forced, in which it contracts other private market insurance companies to take on Citizens’ policies at rates that are within 20% of the Citizens premium. Many of the premiums in those assumption notices are lower than Citizens premiums. Many. Not all, and not enough.

Flood insurance as well has seen historic highs in premiums this year in the wake of last year’s shocking storm surge during Hurricane Ian, and it may be another year until flood premiums go down. Many of those affected by the worst of the storm surge waters either did not have any flood insurance, or they didn’t have enough.

Many of those who did not have any flood insurance said they didn’t think they needed to have flood insurance. Flooding in their area caused genuine shock and awe, and ruined their homes. Many of them are still trying to recoup their losses, even after help from FEMA.

Florida is a flood zone, all of it. What we need to recognize moving forward is that the best thing we can do for ourselves and our wallets is to do everything we can to document what we have through taking photos of the inside and outside of our homes and emailing our receipts for big ticket items to ourselves to date and time stamp them. In addition, purchase flood insurance for your home, knowing you might never need it, or you might need it, but you can’t get it once you need it.

Speak with a local independent insurance agent about making sure you have the right kind of coverage, neither too high nor too low, which may involve your agent performing a new Replacement Cost estimator for your home, with you on the phone, to make sure it’s correct. The only person who knows what you have in your home is you. The property appraiser network for your county may or may not keep updated records, so that you, dear reader, are the best source of information about any changes you have made to your home, to update your coverage accordingly.

There are three basic home incidents that are some of the most frequent causes of water damage claims in Florida:

1-Rubber supply/drain lines that either leaked or burst. Steel braided supply and drain lines are much more durable, and go a long way towards prevention of these types of leaks.
2-Air Conditioning leaks that happened because the AC lines have not been flushed and no anti-algae treatments were deposited into the AC line. Having your AC line flushed every three months and putting anti-algae tablets into the AC line, as well as changing out your air filter every couple of months will help to reduce the chances of loss.
3-Old hot water heaters that have rust and/or corrosion are much more likely to burst or even to explode. If a hot water tank has orange and or green corrosion on it and/or has a manufacture date older than 15 years, replacing the hot water tank with a properly fitted TPR or pressure release valve, is a less expensive option than dealing with a large-scale water claim.

Preventative maintenance is much less expensive and stressful than the kind of insurance atmosphere in which we find ourselves currently. Insurance is there in case something happens, yes, but there are two caveats to this. 1) Not everything is covered and 2) the claims process can take several months to complete.

In short, relief is coming slowly, but we need to do all we can to protect ourselves and our homes and vehicles now, before we have an issue.

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