Will the property insurance crisis in Florida really get worse before it gets better?


The cost of reinsurance for Florida property insurers has increased over 100% in the past 4 years. It is projected that reinsurance will go up another 50% at the time of renewal on June 1st.

If you’re wondering what reinsurance is It’s essentially insurance for insurers. It transfers risk to another company to reduce the likelihood of large payouts for a claim. It’s an extra layer of protection that allows insurers to remain solvent by recovering all or part of a payout.

This system worked great for a while, but now those reinsurance companies are much less interested in the potential risk that Florida property brings. Just in the past 6 years, over $807 billion (with a B) has been paid out in weather related disasters. So, as you can imagine, those reinsurers’ risk appetite for our beautiful state has diminished. The impact of that fallout will be different for each carrier, but significant rate increases are still expected.

From an insurance perspective, we had a rough year in 2022. Rates were at an all-time high, underwriting guidelines were more strict than ever, carriers were going out of business, and our home state was hit with some strong storms causing lots of damage.

Unfortunately for all of us, the reality is that yes it may get worse before it gets better. We expect this summer, typically the busiest time of year for real estate, to be tough when it comes to home insurance being attainable and affordable. We’ve weathered some major storms, quite literally, in the insurance industry before and well… this too shall pass. We also had two different reform bills passed last year giving us hope for change that will benefit all Florida residents moving forward. And it isn’t like we have a choice to avoid it since it’s still likely a required piece of home buying/selling transactions.

The good news is that we are in this together. We want to help get to closing and for all homeowners to feel confident that they’re adequately protected. Our biggest piece of advice to anyone looking to purchase a home is to START THE PROCESS EARLY when it comes to insurance!