The report does not mention. Beat up insurance companies so they leave the state.Exactly
The politicians in Florida are digging a hole and if things get windy down there they are going to be in a huge mess. You think the after math of Katrina was nasty? Wait!
And there are no winds in California, no wind in Kansas or Oklahoma, no tornadoes in tornado alley, no loses anywhere else in the world. Only in Florida. The only state that has EVER cost any of them anything huh? Pay for over 20 years into premiums and then wind up being told that they can’t “afford” the losses? Its part of the game and time for the insurance providers to grow up. You bet and this time you lost. Next time you will win (see last year’s storm damage reports)…
I have no idea what you are saying and/or what you are bitter about.
The problem in Florida is that carriers have realized a return of -37% since 1990. Further, they cannot get the needed rate increases to support loss exposures. Because the government will not take a stand against the banking, real estate or building industries construction continues unmitigated in storm-prone areas. When insurance companies try to honor their fiduciary responsibility to policyholders and/or shareholders, the state chastises them as “greedy.” Meanwhile the state increases the taxpayer’s burden in exchange for approval ratings.
Just because YOU paid premiums for 20 years, and YOU did not have a claim for 20 years does not mean your insurance provider made money. Your premiums may have gone to pay your neighbor’s claims, or the claims of those in other parts of the state. Insurance is risk pooling. When the pool pays out more than it has taken in, it’s a bad year. But that’s what the pool is there for. If the pool pays out more than it has taken in over a 20-year period (as is the case in Florida), then it is unsustainable. There is too much development in Florida right on the edge of the coast. That is what has caused the losses. You wouldn’t stand in a bathtub full of water holding a plugged in toaster and expect to be offered an inexpensive life insurance policy, would you? Well, it’s no different in Florida. The state encouraged the development of properties on the coastline, which are now worth in excess of a trillion dollars. The only problem is the coastline is the most hurricane-exposed in the world. Game over.
Well I guess if we are in an insurance pool to spread the risk amoung the many, as that is what insurance is for, then why are we in a pool by our selves? Is every state in a pool by them selves or is the spread of risk throughout the whole United States. I would believe that in a pool by ourselves we have a high loss ratio. Why are we not amoung the rest in the big pool.
Occasionally I have to say the same thing on one of these Florida nonsense debates… so here we go again.
Hurricanes happen in Florida, not Idaho. So there is no reason to rope Idaho into the problem… what would be the rate to charge, and who the heck would buy it?
There are huge values in Florida properties. They are beautiful, wonderful, places where folks will pay top dollar for the property, the beach, or the climate. So… buy the darned insurance at the rates that include hurricanes and get over yourself!
It’s really quite simple – because hurricanes are seasonal, and because they don’t make landfall every year, just change property policy requirements in Florida to mandate a term of 3 years. Do you youngsters remember when we had 3-year term policies? With the carrier on the policy for 3 years, there is little chance anyone could pretend they could “bet one term” and run off with a bunch of profits.
Then simply make the rates fit the exposure. The Department of Insurance could ask the Registrar of Contractors office to write a nice little pamphlet to citizens about how to build or renovate their structures to be more wind resistent. And carriers, ever after the best risks, will give discounts to those that follow those guidelines.
Florida merely needs to quit pretending that you can charge Idaho wind rates on Miami beach, folks. The owners of those big deal properties can indeed afford the proper rates, and they can also afford to retrofit for better wind mitigation. Florida business then just charges more for the use of those beautiful places… and because of the views, beaches, and climate, people will pay for it. If they don’t… well… then an economy too weak to pay for itself becomes a victim of Darwin.
Excellent comments Pat. It’s interesting how people do not remember paying as little as $280 per year on a home value of $200k as recently as 10 years ago. The collective profit for the industry in Florida has not been favorable. Contrary to what the average citizen or politician thinks.
Also agree that other states don’t need to pay for us.
I totally agree with you SWFL Mark that the companies because of competitive greed did not charge the appropriate rates for many years and now are crying about that. I do agree that actuarial rates should be charged now and should have been. The shell game of having the Travelers, Allstates and Statefarms “Florida” companies should never have been allowed and has not helped, but hurt the system. I have to ask why would a company keep writing business if they have consistantly lost money since 1990. Gee I wonder, could it be that they really didn’t.
Ok, just to let you know, not all of Florida is on a sun swept beach….. Much of Florida is inland and doesn’t have the same Hurricane damage as other parts.
Also, not asking Idaho to pay for Florida problems, just realistic rates to start with realistic expectations and try to keep the prices from rising (if as you say the insurance was 280.00 on a 200,000.00 home) ummm 1000%. There are homes worth less than 200,000 in Florida NOT on the water, NOT in a flood zone, NOT damaged by wind that are now costing 3000.00. Please do not underestimate the percentage of increase. Florida landowners DO NOT mind paying insurance, as it is a necessary evil, as risks do exist, we understand the game! What Floridians are bothered about is the fact that as another reader put it the “Floridian” companies have such control and can increase the rates so drastically.
Tornadoes ripped through Tennessee, causing much damage this week. Tennessee is a tornado prone area…. how much will their insurance increase if they have another one this year?
Please do not oversimplify the issue. There are obvious problems at every corner… why don’t we work to resolve them and charge a FAIR price for the REAL, STATISTICAL product and not ANTICIPATE that property values increase and homeowners win no matter what….
Everything in Florida seems to be backwards – from the laws to the insurance rates to the way the burden of development by huge companies is put on the shoulders and backs of the residents and absentee propertyowners. Developers rarely pay for public improvement when they build huge residential complexes – the infrastructure is added AFTER the development occurs and the taxpayers foot the bill. With regard to insurance – whatever happened to the Law of Large Numbers – spreading the risk of a few over many?
The report does not mention. Beat up insurance companies so they leave the state.Exactly
The politicians in Florida are digging a hole and if things get windy down there they are going to be in a huge mess. You think the after math of Katrina was nasty? Wait!
Anyone know where one can see the study results?
And there are no winds in California, no wind in Kansas or Oklahoma, no tornadoes in tornado alley, no loses anywhere else in the world. Only in Florida. The only state that has EVER cost any of them anything huh? Pay for over 20 years into premiums and then wind up being told that they can’t “afford” the losses? Its part of the game and time for the insurance providers to grow up. You bet and this time you lost. Next time you will win (see last year’s storm damage reports)…
I have no idea what you are saying and/or what you are bitter about.
The problem in Florida is that carriers have realized a return of -37% since 1990. Further, they cannot get the needed rate increases to support loss exposures. Because the government will not take a stand against the banking, real estate or building industries construction continues unmitigated in storm-prone areas. When insurance companies try to honor their fiduciary responsibility to policyholders and/or shareholders, the state chastises them as “greedy.” Meanwhile the state increases the taxpayer’s burden in exchange for approval ratings.
Is that why you are bitter?
Just because YOU paid premiums for 20 years, and YOU did not have a claim for 20 years does not mean your insurance provider made money. Your premiums may have gone to pay your neighbor’s claims, or the claims of those in other parts of the state. Insurance is risk pooling. When the pool pays out more than it has taken in, it’s a bad year. But that’s what the pool is there for. If the pool pays out more than it has taken in over a 20-year period (as is the case in Florida), then it is unsustainable. There is too much development in Florida right on the edge of the coast. That is what has caused the losses. You wouldn’t stand in a bathtub full of water holding a plugged in toaster and expect to be offered an inexpensive life insurance policy, would you? Well, it’s no different in Florida. The state encouraged the development of properties on the coastline, which are now worth in excess of a trillion dollars. The only problem is the coastline is the most hurricane-exposed in the world. Game over.
Well I guess if we are in an insurance pool to spread the risk amoung the many, as that is what insurance is for, then why are we in a pool by our selves? Is every state in a pool by them selves or is the spread of risk throughout the whole United States. I would believe that in a pool by ourselves we have a high loss ratio. Why are we not amoung the rest in the big pool.
Occasionally I have to say the same thing on one of these Florida nonsense debates… so here we go again.
Hurricanes happen in Florida, not Idaho. So there is no reason to rope Idaho into the problem… what would be the rate to charge, and who the heck would buy it?
There are huge values in Florida properties. They are beautiful, wonderful, places where folks will pay top dollar for the property, the beach, or the climate. So… buy the darned insurance at the rates that include hurricanes and get over yourself!
It’s really quite simple – because hurricanes are seasonal, and because they don’t make landfall every year, just change property policy requirements in Florida to mandate a term of 3 years. Do you youngsters remember when we had 3-year term policies? With the carrier on the policy for 3 years, there is little chance anyone could pretend they could “bet one term” and run off with a bunch of profits.
Then simply make the rates fit the exposure. The Department of Insurance could ask the Registrar of Contractors office to write a nice little pamphlet to citizens about how to build or renovate their structures to be more wind resistent. And carriers, ever after the best risks, will give discounts to those that follow those guidelines.
Florida merely needs to quit pretending that you can charge Idaho wind rates on Miami beach, folks. The owners of those big deal properties can indeed afford the proper rates, and they can also afford to retrofit for better wind mitigation. Florida business then just charges more for the use of those beautiful places… and because of the views, beaches, and climate, people will pay for it. If they don’t… well… then an economy too weak to pay for itself becomes a victim of Darwin.
Excellent comments Pat. It’s interesting how people do not remember paying as little as $280 per year on a home value of $200k as recently as 10 years ago. The collective profit for the industry in Florida has not been favorable. Contrary to what the average citizen or politician thinks.
Also agree that other states don’t need to pay for us.
I totally agree with you SWFL Mark that the companies because of competitive greed did not charge the appropriate rates for many years and now are crying about that. I do agree that actuarial rates should be charged now and should have been. The shell game of having the Travelers, Allstates and Statefarms “Florida” companies should never have been allowed and has not helped, but hurt the system. I have to ask why would a company keep writing business if they have consistantly lost money since 1990. Gee I wonder, could it be that they really didn’t.
I would like to know the names of the other four states that faired as bad!
Ok, just to let you know, not all of Florida is on a sun swept beach….. Much of Florida is inland and doesn’t have the same Hurricane damage as other parts.
Also, not asking Idaho to pay for Florida problems, just realistic rates to start with realistic expectations and try to keep the prices from rising (if as you say the insurance was 280.00 on a 200,000.00 home) ummm 1000%. There are homes worth less than 200,000 in Florida NOT on the water, NOT in a flood zone, NOT damaged by wind that are now costing 3000.00. Please do not underestimate the percentage of increase. Florida landowners DO NOT mind paying insurance, as it is a necessary evil, as risks do exist, we understand the game! What Floridians are bothered about is the fact that as another reader put it the “Floridian” companies have such control and can increase the rates so drastically.
Tornadoes ripped through Tennessee, causing much damage this week. Tennessee is a tornado prone area…. how much will their insurance increase if they have another one this year?
Please do not oversimplify the issue. There are obvious problems at every corner… why don’t we work to resolve them and charge a FAIR price for the REAL, STATISTICAL product and not ANTICIPATE that property values increase and homeowners win no matter what….
Done Crying….
http://www.iiidaily.com/jmbriefing.pdf
Everything in Florida seems to be backwards – from the laws to the insurance rates to the way the burden of development by huge companies is put on the shoulders and backs of the residents and absentee propertyowners. Developers rarely pay for public improvement when they build huge residential complexes – the infrastructure is added AFTER the development occurs and the taxpayers foot the bill. With regard to insurance – whatever happened to the Law of Large Numbers – spreading the risk of a few over many?