How Flood Risks and Rising Sea Levels Are Impacting Florida’s Property Insurance Rates

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Written By Blue & Gold NLR Team

 

 

A new report reveals that property insurance rates in Florida have skyrocketed over the past few years. Florida TaxWatch analyzed the state’s property insurance market, finding a 42.5% increase since 2019. Factors like hurricane damage and lawsuits have made it hard for insurers to stay, causing some to leave.

The report says Florida’s insurance market is weak and depends heavily on the state-run Florida Citizens Property Insurance Company, which covers at least 17% of the market and is the most expensive option. If Citizens runs out of funds to pay claims, state law requires all policyholders, including those with private insurance, to pay additional fees.

About 70% of Floridians live in coastal areas prone to flooding. Rising sea levels put more properties at risk, potentially affecting around 64,000 homes worth $26 billion. By 2100, over 1 million homes could be at risk, leading to even higher insurance rates.

Florida has the highest insurance costs in the U.S., making up 10.8% of all premium costs. Premiums vary by county, from $1,824 in Sumter County to $8,162 in Monroe County.

Since 2019, the Legislature has passed reforms to reduce insurance fraud and help insurers. While progress is being made, the report advises lawmakers to stay alert to prevent further market issues and improve resilience. Florida TaxWatch suggests reducing reliance on Citizens by encouraging more private insurers to enter the market.

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