AM Best Special Report on the State of the Florida Insurance Market

In recent years, instability in the Florida insurance market has led many home insurers and reinsurers to pull out of Florida altogether. This has made getting homeowner’s insurance in Florida hard to get and expensive. The major cause is frivolous lawsuits caused by one-way attorney fees. The AM Best Special Report explains the current state of the Florida insurance market in great detail, but here are a couple of factors that have improved it considerably in recent months.

Eliminating One-Way Attorney Fees

The Florida legislature has passed measures essentially eliminating one-way attorney fees, a significant cause of skyrocketing premiums. What are one-way attorney fees? These fees allowed policyholders to pursue legal action against insurance companies and guaranteed “reasonable” attorney fees to legal firms that won cases against insurers. One-way attorney fees resulted in many unscrupulous law firms filing frivolous claims, gaining huge settlements from what would be minor claims. Combining this with the uptick in severe storm damage in recent years drove many reinsurers to insolvency because the premiums they took in couldn’t keep up with the settlements paid out from these lawsuits.

Representation of attorney fees driving up cost for home insurance free quote

Result of Elimination of One-Way Attorney Fees

The Florida Legislature’s statute reforms have encouraged the Global Reinsurance industry to reinvest in the area because “profitability” is again possible.

Cash Infusion into the My Florida Safe Home Program and a My Safe Condo Pilot Program

In April 2024, the Florida Legislature added $200 million to the My Florida Safe Home Program. It increased an incentive match to $10,000 of the cost of home improvements that improve the durability and reduce the susceptivity of the homeowner’s property to hurricane and storm damage. The My Safe Florida Condo pilot program offers condo associations free storm mitigation inspections. These provide the opportunity to apply for grant improvements to improve the condo property’s resistance to storm damage.

These programs should potentially give the carriers a more favorable view of the property’s risk and might result in lower premiums.

Damage requiring home insurance customer service in Jacksonville FL

Cautious Optimism for the Future of the Florida Insurance Industry

“The 2024 Florida AM Best Special Report supports my expectations that we shouldn’t see many large rate increases,” says Dennis Mizrahi. “The reforms and statistics about the growing strength of the reinsurance market in Florida is encouraging.” Because of the many factors involved in calculating the risk and the potential for catastrophic loss due to hurricanes and other severe weather events, finding a path forward for comprehensive coverage you can afford will always be a challenge.

If you want to do your own analysis, check out the 2024 AM Best Special Report. It provides in-depth information about the state of the Florida insurance industry. Some of the other subjects the report covers include:

  • Charts ranking Florida personal property companies DPW leverage and ceded leverage
  • Top 10 Florida Specialists by Ceded Reinsurance Leverage and DPW Leverage, 2023
  • The causes and effects of reinsurer insolvency in 2021 & 2022
  • A timetable of recent Florida legislative reforms
  • Charts comparing Florida property coverage against that of national carriers
  • And more data showing the causes and effects of the defined issues within the Florida reinsurance market

Image representing home insurance free quote

“Because of the complexity of the Florida insurance market, you should always have an insurance expert on your side to get the best reliable coverage available. At Mizrahi and Garris, we follow the trends and share our knowledge of the ever-changing insurance industry to ensure that you have options, so you and your property are protected,” says Mizrahi.

Mizrahi and Garris Insurance Agency – Home Insurance Customer Service Experts

Are you looking for a Jacksonville independent insurance agency that partners with you to ensure your home—whether it is your primary, vacation, or mobile home–has the coverage to protect you from disaster. Then look no further. Connect with us for a home insurance free quote. We’ll help you find a protection plan perfectly customized to your needs.

When you select Mizrahi and Garris, you’re not just a client; we consider you family. Give us a call (904) 262-9202 or click “Free Quote” to talk to an insurance expert today.

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