Florida hurricane forecast brings cautious hope for insurance market
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A below-average forecast for the Atlantic hurricane season that begins Monday was welcome news to more than just storm-weary Floridians.
Why it matters: Hope for a quiet season, plus legislative reforms and no storm hits last year, have home insurance experts cautiously optimistic about the stability of the market, the News Service of Florida reported.
- But that won't reverse the last several years of skyrocketing premiums, the report says, and one hit could topple the last few years of progress.
State of play: Florida has welcomed 20 new property and casualty insurers into the state, most recently this month with Texas-based Builder Reciprocal Insurance Exchange, Lake Mary-based Frontline Insurance Reciprocal Exchange and Arizona-based Wingsail Insurance Co.
- More competition "is the best way to ensure that Floridians can access the best coverage at the best price," Florida chief financial officer Blaise Ingoglia said in a news release announcing the new carriers.
- At the same time, state-backed insurer of last resort Citizens Property Insurance has offloaded over a million policies, dropping from 1.4 million in October 2023 to 336,000 as of March.
- Experts had warned at the peak that a major hurricane could wipe out its claims-paying funds and trigger a "hurricane tax" on all insured homes, cars and boats.
What they're saying: "We are just becoming more and more resilient in the state," said Patricia Born, a scholar in risk management and insurance at Florida State University.
- "So, I'm kind of optimistic that, as we see the next storm, we are going to be in better shape than we have been in the past," Born said.
Yes, but: Florida could benefit from more nationwide providers with more diversification, she said.
Flashback: Lawmakers passed a slate of reforms in 2022 and 2023 aimed at reducing the number of Citizens policies and limiting lawsuits against insurance companies.
- That's made insurers profitable again, although that relief has yet to reach consumers, the Sun-Sentinel reported last year.