03

Why Home Insurance Rates Are Increasing

posted on

For anyone who owns a home in Florida, playing the homeowner’s insurance rates is fairly challenging at the moment. Unfortunately, it seems that the rates are only going to keep rising for a while. The average rate along the coast of Southwest Florida can range between $2,100 to $5,400 yearly. Florida is increasingly beginning to be known as a risky business area for insurance companies. This is why many of the major insurers such as Allstate are no longer writing policies in the state. The high risk customers such as those who live on the water or right near the beach, or even those who have old homes, would be forced to go with the state insurer out of their last resort -- Citizens Insurance.

More than one million people in Florida use Citizens Insurance and their rates are known to be climbing them most. Southwest Florida has actually not seen a hurricane in years. However, there have been two major tornadoes that swept through Oklahoma within just the past month. The rates there were dropped by 12 percent. However, the rates in Florida went up by 2 percent during the same time period. There are many insurance customers that are asking why the rates in Oklahoma are going down while the rates in Florida are continually rising. Ultimately, Florida has an enormous risk level. A tornado isn’t about to do the same kind of damage that a hurricane is able to, so it affects the rates and the risk level different.

There are also more people in Florida who have higher property values. The losses would be much greater in Florida if a stronger natural disaster were to occur. For example, if the 1926 hurricane that hit Miami were able to hit again today, it would cost around $130 billion in losses. There are many people who have their homes paid for who are opting to go without insurance completely, however, because they simply can’t afford the rates. There are many people who are making the choice not to be insured, which is not something that the insurance companies want to deal with, but feel as if they’re essentially forcing them to based upon the rates.

Those who have a mortgage don’t get that option, however. When you have a mortgage, you are required to have insurance. As a result, that leaves those who have mortgages to be paying more money in terms of rates while getting far less coverage than what they would prefer. Most experts recommend that homeowners should review their insurance policies with an agent in order to work towards saving more money. Sometimes just a few construction updates, such as replacing your roof or making other changes around the home can help to bring down your rates substantially. If you have any questions, getting in contact with your insurance provider is the ideal choice for more information or for assistance with making changes to your policy.