Property Insurance Questions and Answers


Abora Julie A MartinBy Julie A Martin, Licensed Agent at Abora Insurance Group LLC

Dear readers, storm season is again upon us, and with the first breath of stormy winds comes confusion when it comes to our insurance options. Why are the rates so high? Why are my premiums higher than my neighbor’s when we have the same size house? Why am I being non-renewed for not providing flood insurance when I am not in a flood zone?

All good questions, and we have some answers. First to the question of flood insurance. Citizens and Peoples Trust both enacted rules in accordance with the State of Florida that require flood insurance for properties in flood zones, whether or not your property has a mortgage requiring you to carry it. In addition, Citizens is in the midst of a four-year plan to get all of their policyholders to carry flood insurance on their homes regardless of flood zone.

Currently, owners of homes with dwelling coverage 600K are required to carry flood insurance on their properties regardless of flood zone in order to maintain a property policy with Citizens Property Corp., the state backed insurer.

Next year, owners of homes with 500K and up will be required to carry flood insurance regardless of zone. By 2027, all homes insured with Citizens will be required to carry flood insurance in order to maintain property insurance with Citizens.

For the readers who are curious to know why two houses on the same block, with the same square footage, and quality of interior and exterior features would be insured for different amounts, and even have drastically different premiums, there are over 300 different rating factors that determine the pricing structure of a home.

Wind mitigation features are key here. Let’s suppose that although both homes were built in 2004, and both have been re roofed with permits, if your neighbor has a Hip shaped roof, which is a roof that slopes on all four sides like a pyramid, and you both have Roof Deck Attachment C, and Clips, and you both have A1 Opening protection, that Hip Roof shape credit could generate an additional 15% premium discount to his home insurance premium. If your neighbor has Hip Roof and opening protection credit, and you do not, there will be a marked difference in the way his home is rated versus the way your home is rated.

Also, comparison of properties needs to consider are the type of property insurance form both homes are covered under. Maybe your neighbor rents his home out to a long-term tenant, and so his policy would be DP3, which does not require a high level of personal property contents; whereas, your owner occupied HO3 policy requires at least 25% of the dwelling in contents coverage, as is standard under Florida home insurance package policies.

There are eight new carriers in Florida that have recently become authorized to transact new business for property insurance in the state of Florida, within the last few months, which include Orion 180 Select Insurance, Orange Insurance Exchange, Mainsail Insurance and Tailrow Insurance, to name a few. It will take time for the Florida property insurance industry to spread the risk around more evenly in the next year or so for the rates to come down. But, eight new carriers means that there will soon be some relief, even if it might take a year or more for us to see it.

Stay tuned, dear readers. More good news might be just around the corner, but let’s be prepared for an active storm season.