ORLANDO, Fla. – 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 rose by double digits on 1 July.
These increases are usually passed on to consumers, according to industry experts.
Gallagher Re, a global reinsurance broker that distributes insurance for insurers, has raised rates due to rising losses, analysts said.
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The company publishes its report three times a year in key renewal seasons—January. 1, 1 April and 1 July.
The latest report shows that the cost of U.S. property catastrophe reinsurance in Florida rose as much as 40% this month, and it comes as more insurers leave the state.
Sara 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 made the decision to “non-renew all lines of business in the state of Florida,” according to the email. “Just like you, we found out this news today.”
– I was quite disappointed. I was discouraged. I was sick,” Moore said. “I didn’t know what to do, like the rest of everyone else.”
That means more people are looking for insurance in Florida at a time when it can be difficult to find and expensive to do so.
“First, I have two properties to insure. You can’t live on two properties, says Moore. “I’ve never had a break. Everything keeps going up and up and up.”
And it probably goes up more.
Gallagher Re released its July report showing reinsurance rates for policies previously exposed to claims for natural disasters rose 30% to 40% this month.
“Overall, there was sufficient access to capacity to cope with renewals, albeit with meaningful price increases which are now being reinforced over several years,” the report shows.
Florida CFO Jimmy Patronis is aware of that.
“Reinsurance has the same problems with 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 every single person in the state, but again not just the state, it’s the entire nation.”
But it seems to be hitting Florida harder than most.
According to the Insurance Information Institute, the average cost of property insurance in Florida this year is $6,000, a 42% increase year over year.
The average US premium is $1,700, up 11% from 2022.
Consumers like Moore know that all too well.
“If they’re going to jack it up that much more, I’m done,” Moore said.
Industry analysts said those affected are likely to start seeing the increases at the next renewal.
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