What has occurred to the Florida property insurance coverage market barry gilway

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Barry Gilway

How did we transfer — in simply 5 years — from a vibrant market the place financially stable corporations competed for enterprise to an unhealthy surroundings the place policyholders who’ve by no means filed a declare are being dropped or see their premiums leap by 30, 40, 70 % in a yr? 

Lately, we received a solution.

The Florida Workplace of Insurance coverage Regulation reviewed 750 insurance coverage corporations from across the nation. It discovered that Florida accounted for under 8 % of all claims filed nationwide in 2019, however practically 76 % of all lawsuits. That quantity, taken from knowledge gathered by the Nationwide Affiliation of Insurance coverage Commissioners, shouldn’t be solely mind-blowing however clearly unsustainable except Floridians settle for the extent of price improve we’re seeing right now.

Whereas the NAIC knowledge is unbelievable, it’s not surprising. Florida home insurance coverage corporations posted a $1.6 billion working loss in 2020, the newest of 4 progressively unprofitable years. Whereas storm exercise performed an element in final yr’s losses, keep in mind that no main storms hit Florida in 2020. As a substitute, the main purpose for these unsustainable losses is extreme and abusive litigation on a scale that exists nowhere else within the nation.

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