Apr 6, 2023 - Business

Floridians could pay more for the next big storm

Illustration of a hundred dollar bill with Benjamin Franklin holding an umbrella.

Illustration: Aïda Amer/Axios

Florida is one big storm away from an even more expensive, home insurance industry.

Driving the news: The state's largest home insurer, Citizens, is seeking a 14% rate increase starting this fall, which the state will need to approve.

  • Citizens warns that it may need to impose a "hurricane tax" — a fee on all property insurance holders in the state — if another big storm, or even a series of smaller ones, hits the state this year, per a recent company report.

Why it matters: Hurricane Ian's devastation in Florida last year left insurers like Citizens depleted, and now homeowners are bracing for their already climbing insurance rates to go higher.

The big picture: National property insurance companies posted the worst year of underwriting losses that the industry has seen in over a decade, per data from analytics firm Verisk. Last year's total losses were estimated to be $26.9 billion — more than six times the losses reported in 2021.

  • Florida's insurance market is drowning in more than $1 billion of losses.

What's ahead: If Citizens' rate hike is approved, it would take effect Nov. 1. But it's not guaranteed.

  • The state denied the insurer's proposed increases last June.

What we're watching: The start of hurricane season is two months away. Accuweather's 2023 Atlantic hurricane season forecast predicts four to eight named storms will reach hurricane strength, with one to three of those achieving major hurricane status.

Go deeper: The Miami Herald digs into what's behind Citizen's "hurricane tax."

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