Homeowners insurance: Floridians pay more than double U.S. average

Article Courtesy of The Tampa Bay Times

By Jeff Harrington

Published January 28, 2015


It's still more expensive to buy homeowners insurance in Florida than anywhere else in the country.

In fact, Florida homeowners are now paying more than double the national average.


Average insurance premiums statewide for the most common type of homeowners policy rose nearly 8 percent in 2012 to $2,084, according to data released this week from  the National Association of Insurance Commissioners.

That makes Florida the first state to cross the $2,000 mark in average premiums and widens the gap between the next two states on the list, both of them coastal:  Louisiana (average premiums of $1,742) and Texas ($1,661).

The national average: $1,034. For the record, Florida's premiums are 102 percent higher.

To calculate the numbers, the NAIC collected data from insurance statistical agents for all states except Texas and California, both of which supplied data directly to
the association.

The Suncoast Gateway Mobile Village in Port Richey is flooded after Tropical Storm Debby in 2012. Florida has become the first state to cross the $2,000 mark in
average premiums for homeowners insurance policies.

Given the long lag in compiling and releasing state data, the latest snapshot doesn't reflect the impact of any recent moves to curtail high premiums. Throughout 2014
private insurers across Florida along with state-run Citizens Property Insurance have cut rates for most property owners amid lower reinsurance costs, a cutback in
eligibility for sinkhole insurance, and what turned into the ninth-straight hurricane-free year.

Still, even for homeowners used to paying higher rates, the numbers are a shocking wake-up call.

J. Robert Hunter, director of insurance for the Consumer Federation of America and former Texas insurance commissioner, said he was surprised not that Florida
remained No. 1 but that it widened the gap between fellow hurricane-susceptible Louisiana.

He suspected some price gouging by reinsurers, who provide insurance companies an extra layer of coverage to pay for claims after a catastrophe.

Within Florida, Hunter said, the cost to property owners varies to a wide degree.

"There's a huge difference between South Florida and the rest of the state," he said. "The coastal areas in particular. South Florida, all the models say, is the most
at-risk place in the country."

Hunter gave credit to state officials, including beleaguered Florida Insurance Commissioner Kevin McCarty, who worked to make insurers buy some reinsurance through the
Florida Hurricane Catastrophe Fund.

"Your rates would have been much higher if the state didn't act in 2006," he said. "It's bad, but it could have been a lot worse."

By the numbers

$2,084 Average insurance premiums in Florida for the most common type of homeowners policy.
$1,034 Average insurance premiums in the United States for the most common type of homeowners policy.