Orlando, Florida. Property insurance rates are likely to continue to rise in Florida.
A global market analysis report released three times a year confirmed that reinsurance rates increased by double digits on July 1.
According to industry experts, these increases are usually passed on to consumers.
Gallagher RIAnalysts said, a global reinsurance broker that provides insurance services to insurance companies, raised interest rates due to sharp losses.
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The company releases its report three times annually during its main renewal seasons – January. 1, 1 April and 1 July.
Its latest report shows that the cost of reinsuring real estate in Florida rose 40% this month, and it’s happening as more insurers leave the state.
Sarah Moore is one of 100,000 people in Florida, insured by Farmers Insurance, who are now looking for coverage after the company suddenly announced last week that it was leaving the state.
“I was completely shocked. I had no prior knowledge of anything,” Moore told News 6.
Last Tuesday, Moore received an email, not from Farmers, but from her insurance agent notifying her that the company had made the decision to “not renew all business lines in Florida,” according to the email. “Just like you, we found out about this news today.”
“I was so disappointed. I was down. I was disgusted,” Moore said. “I didn’t know what I was going to do, like all the other people.”
This means that more people are looking for insurance in Florida at a time when it can be difficult and expensive to find.
“First of all, I have two properties to insure. You can’t live in two houses on two properties,” Moore said. “I never got a break. Everything just keeps going up and up.”
It is likely to rise further.
Gallagher Re released its report for July which showed reinsurance rates for insurance policies that previously faced claims related to natural disasters rose 30% to 40% this month.
“In general there has been an adequate supply of capacity to clear renewals, albeit at significant price increases now compounding over several years,” the report states.
Florida CFO Jimmy Patronis knows this.
“Reinsurance faces the same problems as regular insurance,” Patronis said. “I tell people all the time, ‘If your home insurance rates haven’t gone up 50% in the last two years, you don’t own a home.'” So, it affects everyone in the state, but again not just the state, but the entire nation.”
But it seems to hit Florida the most.
According to the Insurance Information Institute, the average cost of property insurance in Florida this year was $6,000, up 42% year-over-year.
The average insurance premium in the US is $1,700, 11% higher than it was in 2022.
Consumers like Moore know this all too well.
“If they want to take it that much higher, I’m done,” Moore said.
Industry analysts said those affected are likely to start seeing increases in the upcoming renewal.
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