Courtesy of NAPLESNEWS.COM
Published Monday, July 31, 2006
It doesn't matter if your condominium is east of
Goodlette-Frank Road, built like a fortress, or if your condo association
has never filed a hurricane-related insurance claim.
The rates have gone up anyway.
And the hardest-hit policies are for the
association's common areas. That's because insurance companies view that
as a commercial policy and lump it in with an agency's small-business
division, a market segment insurers have labeled unprofitable and are
While residential insurance policy rates soar, and
insurers cancel policies held by small-business owners, condo associations
around Southwest Florida are voting in special assessments to cover steep
hikes in insurance premiums.
The Wilshire Pines condominium got hit with a double
First, the Naples-area 64-apartment building lost
its insurance policy.
Then, when condo association leaders found a new
insurer, the premium was almost three times what they had been paying.
The premium increased from $35,000 to $100,000,
Wilshire Pines condo owner Tony Monaco said.
It means a special assessment for the 64 unit owners
and creates another hurdle in the quest for affordable housing in
Southwest Florida, Monaco said.
Association directors had no choice but to impose a
$1,534-per-apartment special assessment, above and beyond any existing
association fees and assessments, Monaco said.
"That is only to cover the premium," he
The premium increases proportionally were comparable
in the upscale Pelican Bay subdivision.
The association's insurer dropped them they got
the notice Wednesday and association directors had to scramble for a
Built in 1986, the Glencove never has filed an
insurance-related claim, condo owner Jim Burke said.
Condo association directors of the Glencove, a
96-apartment building in Pelican Bay, watched their premium soar from
$96,227.59 to $369,490.57.
Glencove association directors are scheduled to meet
Aug. 10 to vote on a per-apartment special assessment of $1,729.23 to
cover the increase in the insurance premium, said Burke, who also is
chairman of the Pelican Bay Services Division, a municipal taxing and
"The numbers are shocking, and no one is
talking about it," Burke said.
It's not just affecting already built and
Because of the way condo law is set up the
builder owns each condo until it is sold developers also are taking a
nasty hit, said Kim Minarich, vice president of Gulf Bay Group of
Her company isn't having problems getting insurance,
but the premiums have skyrocketed, Minarich said. Her company is still in
the process of building out Fiddler's Creek on Collier Boulevard, between
Marco Island and East Naples.
"For instance, our builder's risk insurance
increased nearly 450 percent from 2005 to 2006; property insurance
increased 241 percent, and liability which has nothing to do with
hurricanes, does it? increased 40 percent," Minarich said,
although the dollar figures associated with the percentage hikes weren't
Bonita Springs homeowner Robert Barbieri said he
hopes home and business owners have a long memory and don't forget what
insurers have done, and which insurers were especially heartless.
His home is on the water, and for three years he had
a policy with Allstate and never filed a claim.
Allstate dropped him six months ago, Barbieri said.
Then, Allstate had the gall to "cold call"
him to try to sell him car insurance, he said.
Insurers take note, he said: "I won't ever
give them a lick of business."
Furthermore, condo associations are thinking about
fighting back by self-insuring, a trend if carried through by every
association in the state that severely could damage the remains of the
insurance industry to shock them back into reality.
If every condo association in Pelican Bay decided to
self-insure by pooling money through the Pelican Bay Foundation or Pelican
Bay Property Owners Association, associations probably wouldn't need
insurance companies, Burke said. There are 92 individual condo and
homeowners associations in Pelican Bay. Some of the high-rises have
considerably more units.
Take that per-condo special assessment, multiply it
by the number of apartments in each building, then, by the number of condo
and homeowners associations in Pelican Bay, and the community could
probably tell all insurers to take a hike, Burke said.
Insurance companies justify pulling out of markets
by saying that continuous risk analysis indicates which markets are
profitable and which are black holes. State leaders are scrambling to
address the dropped policies and skyrocketing premiums, but haven't yet
come up with a solution.