HERNANDO, Fla. — Florida homeowners are grappling with skyrocketing insurance costs, a trend exacerbated by a string of devastating hurricanes. Residents are now facing difficult decisions about whether they can continue to afford to live in the Sunshine State.
Deanna Overkamp, 63, a Hernando Beach resident since the early 2000s, shared that her homeowner’s insurance bill doubled compared to the previous year. This forced her to search for a new policy.
“So, the companies will more than likely raise premiums to recoup the losses that they’re paying out,” said Lex Barker, an independent insurance agent in Hernando County.
Following Hurricanes Helene and Milton, both of which caused billions of dollars in insured losses according to Florida Realtors, homeowners and insurance agents are concerned about further rate hikes. A report from Insurify, an agency that helps consumers compare insurance plans, projects a 7% increase in Florida’s home insurance rates this year.
During Hurricane Milton, Overkamp’s home was badly damaged. Floodwaters filled the house with six feet of water. A tree or other large object smashed into her garage, creating a massive flood that swept through the house, tearing shelves from walls and peeling up the carpet.
“The whole house was pretty much underwater,” Overkamp stated.
Independent insurance agent, Lex Barker, explained that a recent pattern of hurricanes has heightened the urgency and stress related to increasing insurance costs. Within just weeks, two hurricanes struck Florida, resulting in widespread damage and significant financial losses.
According to the Insurance Information Institute, the average annual premiums for homeowners in Florida in 2019 was $1,988. In 2020, it rose to $2,165, and by 2021, it had increased to $2,437. This represented a $272 increase from 2020 and a $449 increase from 2019.
Danielle Healis, the general manager of Killingsworth Insurance in Hernando County, with 36 years of experience in the industry, suggested that fraud and price gouging in the home repair and construction sectors, along with fraudulent claims, are contributing to the increasing insurance costs. She added that rates are determined by a home’s overall risk and exposure, including its history of past losses. Coastal areas generally have higher rates due to their increased risk of damage.
For residents in high-risk zones, finding willing insurers can be challenging. John Paul Reeve, president of the Marine Safety Group, was photographed sweeping water out of the Coast Guard Auxiliary Building.
Keith Holcomb, another resident who lives near the Withlacoochee River, mentioned that he has been dropped by five different insurance companies in the past six years due to the high flood risk of living so close to the river. He is now covered by Citizens Property Insurance Corporation.
“They’ll just say they’re no longer covering, and that’s it,” he remarked.
Barker added that Citizens is the insurer of last resort in Florida and will write policies when other companies will not. He mentioned that 20% of the policies he writes are through Citizens.
To determine insurance policy, Barker accesses tax rolls to gather details about a home, such as its size and number of stories. He then inputs these details into TurboRater, a program that helps insurance agents compare quotes from different insurers. It provides Barker with a list of the top five companies offering the most competitive rates, which he then presents to his clients.
Kathy Orloff, who has lived in Hernando Beach since 2010, experienced significant losses during Hurricane Helene. She had three feet of water flood her home, leaving many of her belongings piled up on her lawn. Orloff stated that she didn’t have much wind damage during the hurricane, which meant that most of the repair costs would be covered by flood insurance rather than homeowner’s insurance.
Healis and Barker both emphasized that foregoing home or flood insurance is not a worthwhile risk, given the extreme costs of rebuilding after a hurricane. Healis adds that many people have all of their savings tied up due to their home purchase.
“I think (not having homeowners insurance) is going to hurt them financially because when you go through a time frame where there’s no claims and no storms, it doesn’t seem like such a bad idea until you get hit with one and realize the huge impact by not having that coverage,” she said.
Homeowners can take steps to potentially reduce their premiums by replacing outdated roofs, adjusting deductibles and modifying coverage limits for their homes, Barker noted. The time it takes for insurance companies to process payments depends on the extent of the damages to a homeowner’s property.
