After eight years of significant losses, Florida’s personal property insurance market has reported an underwriting profit and a substantial increase in operating income for 2024, according to a recent report by AM Best, a renowned rating and analytics firm. The report analyzed data from 45 insurers operating in Florida, excluding large national carriers and Citizens Property Insurance Corp., the state-created insurance entity.
Key Findings
The combined ratio for these active Florida insurers improved to 93.1 in 2024, down from nearly 100 the previous year. This improvement translated into underwriting gains of $207 million, a significant turnaround from the $174 million loss recorded in the preceding year. Josie Novak, a senior financial analyst at AM Best, attributed this positive shift to ‘legislative reforms’ that not only benefited existing insurers but also attracted new entrants to the market, thereby increasing capacity.
The report highlighted that the departure of certain carriers from the market, either through reduced participation or suspension of new business, created opportunities for new companies to establish themselves. This development has contributed to a reshaping of the competitive landscape in Florida’s insurance market.
Growth in Direct Premiums Written
Direct premiums written by active Florida insurers have shown a steady increase, rising from approximately $5 billion in 2020 to over $11 billion in 2024. Despite this growth and the overall positive trend, the AM Best report cautioned that ‘hurricane-related risks remain the most notable concern’ for the market.
The analysis also noted that Florida insurers have a significantly higher reinsurance dependency compared to the US personal property composite average (519.4% vs 62.2%). This elevated reliance on reinsurance is attributed to Florida’s unique exposure to catastrophic weather events.
The AM Best report’s findings are consistent with a 2024 analysis by S&P Global Market Intelligence, which observed improving underwriting losses among Florida’s top 50 property insurers following legislative reforms.
For more detailed information, the full AM Best report is available on their official website.
