The loss of homeowners insurance is a growing crisis in Florida and if you are not affected yet, you may soon be.
78,000 homeowners insurance policyholders are losing their coverage because Southern Fidelity Insurance will be liquidated.
It’s the fourth Florida insurance provider to fail this year and the first since state lawmakers met to tackle the property insurance crisis.
“Since the special session of the legislature took place last month Florida’s private insurance market has been spiraling down a cliff,” said Mark Friedlander with Insurance Information Institute. “The legislature did not fix the problems that are causing the crisis in our state.”
In Tallahassee, lawmakers met to try and tackle the issue. Reinsurance was key, but Friedlander said even the global reinsurance market thinks Florida is too volatile.
“It is not a market they want to invest in so they’re pulling back on the reinsurance coverage and, once again, they point the finger at the legislature for not addressing the critical issues driving this crisis,” said Friedlander.
It’s the door knocks, promising you a new roof, thousands of frivolous lawsuits and billions paid out to lawyers, says Tyler Nagle with Nagle Insurance LLC.
“Between 2013 and 2020 Florida’s property insurance paid out $15 billion and claim costs only 8% of that was paid to consumers will 71% was paid to attorney’s,” said Nagle.
It’s problems like this that are causing more and more providers to fail, write letters of non-renewal, or not take on new business at all.
“We had news at about noon (Wednesday) of another big one leaving at 5 o’clock today,” said Nagle.
The insurance crisis is reaching many other sectors of business too.
“I was left with four or five hours of helping mortgage professionals, real estate professionals, relying on insurance for this closing and now to come say, ‘hey, I know you’re closing later this month, we are going to have to take a u-turn or we’re going to have to pull the trigger right now,'” Nagle said.
Nagle said we will likely learn of that new provider not taking on any new business soon, but it’s absolute proof this problem is going to get worse before it gets better.
Friedlander said ‘better’ likely wont be for a couple of years.