Florida property insurance premium question - Posted by rebeccax

Real Estate Investing
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Posted by Wayne-NC on November 16, 2006 at 18:04:18:

OK Bill, the cost of living on the direct coastline has just gone up considerably, and that doesn’t include interest rate and tax increases. My question to you is, if it will take years and years to recoup from Katrina, what will happen WHEN it happens again especially if we haven’t enough time to recoup from the past? My answwer is that it has to be reflected in the price of the property. “Almost gave it away” is not a good sign.

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Florida property insurance premium question - Posted by rebeccax

Posted by rebeccax on November 13, 2006 at 16:41:42:

I received my annual property insurance premium on my personal residence and the limits of liability have been raised 70% over last year’s. My carrier is Citizens, the state run insurer of last resort.

I received a letter around August this year saying that my agent needed to reassess my coverages or I would be dropped. About a month later, I received the increased liability limits which had been raised about 40% over last year’s. Then, just this month, the limits were raised again and are now 70% higher than last year’s.

Of course I understand that hurricanes have hit and we in Florida (I live on the gulf coast) are being hit hard with increased premiums.

Here, however, is my question. How did the insurance company determine that it would cost 70% more than it did last year to rebuild my house and replace its contents if all were completely obliterated? 70%!!! For example, the replacement cost for the contents inside my home certainly did not increase 70% in one year.

I am afraid to call my agent to ask for an explanation because folks at work tell me that my coverage will be dropped. There are so few insurers left around here that, if dropped, i’ll end up with Joe Blow’s Insurance for Gulf Residents and if I think I have heartburn over my premiums now…!!!

How can i find out if my limits of liability are too high? What can I do?

Thank you for your time… I know this was a long post.

Rebecca

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Florida property insurance premium question - Posted by Bill H

Posted by Bill H on November 15, 2006 at 17:10:45:

We moved from the gulf coast of MS for that reason and the fact that it will take years and years and years to recoup from Hurricane Katrina.

We had dinner with our friend and former State Farm Agent who told us:

  1. they can write no insurance within one mile of the gulf coast shoreline.
    2, In the back bay areas and beyond the one mile limit they can write no insurance within one half mile of any waterway, slough, bayou, creek, river, etc.
  2. they can write no commercial insurance south of Interstate 10.
  3. they can write no wind insurance unless you are also in the MS windpool insurance program…very expensive like your FL insurance.

Insurance rates in MS are partially controlled by the Insurance Commissioner. Most insurers had asked for up to 980 percent increases. Through negotiations they got part of it.

What to do? I really do not know what to tell you. As I said…we just packed up, sold out (almost gave it away) and moved from the coast. What the hell, I’ll just get a couple of dump truck loads of sand and an outdoor above ground pool and a wave generator. It’ll be cleaner than than the gulf waters and will not smell fishy at all.

Good luck,
Bill H