(The Center Square) — Officials held a town hall meeting this week to discuss skyrocketing property insurance costs for Floridians.
Property insurance in the Sunshine State is the most expensive in the U.S., with residents paying $2,165 annually in 2020, according to the Insurance Information Institute. The Institute projected in Aug. 2022 that Florida property insurance rates could reach over $4,000 annually.
In Sept. 2022, Hurricane Ian smashed into Florida’s Gulf Coast, causing billions in damage to properties, businesses and infrastructure.
Research company CoreLogic estimated that the cost of Hurricane Ian would be between $28 billion and $47 billion and noted that Ian was one of the costliest storms since Andrew in 1992.
Timothy Cerio, the President, CEO and Executive Director of Citizens Property Insurance Corporation, said during the town hall on Tuesday that one of his main concerns is ensuring Citizens runs as efficiently as possible without stifling the market. Citizens is a state-owned insurer of last resort.
“Ideally the state’s residual insurer should want a healthy market, that we are there for people who just can’t get insurance anywhere else, and instead we’re the largest,” Cerio said.
Sen. Jason Pizzo, D-Hollywood, noted during the meeting that Citizens uses a different pricing model from traditional insurers and often state assessments for insurance will be less than the estimates of private insurance providers. Pizzo also pointed out that policyholders are forced to go with third-party insurers if their claim assessments are under a 20% threshold of their policy.
Tim Cerio stated that the reason this is required by law is to discourage people from solely relying on Citizens for its cover.
“We were set up to be the insurer of last resort, which means we are there if you can’t go anywhere else. The larger we are, if there is a catastrophic event…the more we are at risk,” Cerio said.
According to Zillow, Florida homes have a median price of $390,052. Using recent data from Insurance.com, as of Aug. 2023 a $400,000 policy would cost a Florida homeowner between $1,084 and $6,301 per year depending on the property and its location with the top price coming from Citizens Property Insurance.
