Florida Carriers Seek Staggering Rate Increases Amid Market Turmoil

By | February 25, 2020

  • February 25, 2020 at 1:29 pm
    Jack says:
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    Either let them raise rates or they will exit the market. Then you will get really high rates from surplus lines markets. The rates are headed up, way up here in SC. Consumers better hope it doesn’t get back to 2006 rates or the real estate market will take a hit.

    • February 25, 2020 at 2:32 pm
      Andrew says:
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      Yup. Is the average cost of Homeowners coverage more, less or about the same as the the average cost of Auto insurance in SC?

    • February 25, 2020 at 2:54 pm
      retired risk manager says:
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      Jack: You missed one key point. At some point, all companies have to reinsure. At some level, the reinsurance markets will say NO MORE. Then what?

      • February 25, 2020 at 4:07 pm
        SWFL Agent says:
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        The article mentions the “loss creep” from hurricane Irma but really does’t go into much detail. This has been a huge problem in SWFL and we still average about 1 roof claim per week even though Irma was 2017. At least three (3) roofers per day run ads in the newspaper advertising “storm damage” and we’ve seen estimates that exceed $100k for new tile roof installation on a 2100 sqft home. The reinsurance carriers are on the hook for these claims and it will be difficult years ahead for those companies that have a strong reliance on reinsurance.

    • March 2, 2020 at 2:40 pm
      JaxAgent says:
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      Hey Jack,
      I recently helped place my brother’s HO policy (frame/ $1.5M/ couple of miles NW of Beaufort) and we got it done through Vault. They did a nice job & beat Auto Owners pretty handedly.

  • February 26, 2020 at 4:08 pm
    Florida Consumer says:
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    What about State Farm? They are second largest carrier and they just reduced their rates by 14.4% which would seem to indicate they are making money. And Universal, the largest carrier, which had a 24% ROI in 2018 and 25% in the first half of 2019. They are making money as fast as they can count it. Why are these two companies so successful in Florida while these other losers whine about AOBs?

    • February 26, 2020 at 8:54 pm
      okt0ber says:
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      State Farm’s rates were extremely high before they adjusted them.

    • February 27, 2020 at 10:43 am
      Actuary says:
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      Universal writes a significant amount of business in the tri-county area and charges huge wind premiums to cover the risk. Since SE Florida has avoided any real hurricane damage recently, that wind premium can subsidize non-hurricane losses and hide the issue.

    • February 28, 2020 at 7:10 am
      CL PM says:
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      FC – In this industry, one-year, two-year and even three-year ROIs are not a meaningful statistic. Homeowner companies in FL need non-hurricane years to yield ROIs of 25%+ because in a hurricane year, the ROI will be -50%. To get a true picture of profitability in Florida, look at 10-year ROIs.

      • March 1, 2020 at 7:37 pm
        Mr. Solvent says:
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        Universal has been consistently profitable for years.

    • March 2, 2020 at 2:37 pm
      JaxAgent says:
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      AOB was a scam that was well worth ‘whining’ about. You should do a little more reading before you launch a scud like your post. It ain’t a good look for you.

  • February 27, 2020 at 3:09 pm
    Artie Makris says:
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    Amy,
    Are we able to connect on this article? VIP Software can help the carriers with this ongoing issue. Can we connect?

    Artie

  • March 2, 2020 at 1:28 pm
    Pete says:
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    Insurance abuse in the end affects everyone. Insurance companies should have been more aggressive in dealing with water damage losses. Complacency got them to be the funding arm for legal abuses. The constant barrage of tv ads by attorneys such as: Dan Newlin got me $xxx,xxx or Morgan & Morgan ads stating – you might have a claim, but don’t worry it will not cost you anything, insurance could pay for it. Yea, Well who pays for insurance? The consumer! At some point insurance companies must pass those costs onto consumers due to excessive losses. Well right now, we the consumer will see the effects of those excessive losses and that: Hey don’t worry insurance will pay for it!

    • March 4, 2020 at 2:01 pm
      Victor says:
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      100% I have been in the biz for over 20 years. I was warning marketers 10 years ago about them just paying claims. They said it was easier and cheaper, but now it is biting them in the butt. The state has to get the multipliers taken care of, I know the AOB issue is a lesser issue, but still there. I also stopped writing biz with carriers who had sloppy claim control. BTW two of those carriers are gone.

      I use to hate the a certain carrier’s in house model, but in today’s world, I like it. They control the claim from moment one to the end. All these carriers need to make sure they know who is working on the claim and control it. Right now, you have contractors knocking on doors asking who their carrier is. They know who the pushovers are and the companies they do not want to deal with. Carriers really need to become the latter.

      We are going to see more carriers start limiting coverages like water, non renew due to roof age, and so on. I still do not understand why ACV is not being used on a HO3 for roofs. I know the HO3 has it in the policy, but the policy needs to change. In fact, one carrier puts ACV on a roof older than 10. I think in all the time I have been in the business, even with Charlie, this is the worst I have seen it. Rates going up does not help an agency. You are going to be shopping, cutting different coverages, losing business to nationwide carriers, and overall stress of all the non renewals. Agencies are not set up to keep rewriting personal lines because of non renewals.

  • March 27, 2020 at 4:15 pm
    Berle Hopkins says:
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    My home insurance carrier increase their rates 36% over 2019. My agent ran a quote to include over 20 different insurance companies. All carriers had raised their rates to unbelievable levels. How can the Florida Insurance commissioners justify granting such increase in a recession and total shutdown of businesses due to current crisis? The DOJ needs to cite every carrier for price gouging by increasing prices of goods or services to a level much higher than is considered reasonable or fair. The attorney general should investigate the Florida Insurance Commission. Something is rotten in Tallahassee.



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