At the end of March, the Florida Legislature ended its session with an April Fools’ to every homeowner in the state.
The legislators could not come to an agreement on passing insurance reform in the face of rising insurance rates and fewer companies in the state, leaving homeowners without any relief for this year.
The bill that was in play was passed by the Florida Senate, but the House leadership wouldn’t accept it. Part of the proposed legislation was a modification of the insurance deductible for roof replacements. Naturally, homeowners with older roofs would have borne the brunt of the cost. The bottom line is that homeowners all over the state are faced with increasing rates and policies dropped at renewal time.
Part of the reason for this is that insurance companies are losing money in the state. According to the Insurance Information Institute, Florida insurance companies had $1.6 billion in underwriting losses in 2020. This is in addition to the companies’ experiencing rising costs of reinsurance, as well as fraud in the roofing industry and frivolous lawsuits.
As a result, many insurance companies are not renewing policies on homes that have roofs more than 15 years old and are even being picky about what types of homes they want to cover. Homeowners’ and condominium associations are now faced with replacing roofs on older buildings and homes during a time of supply shortages, high demand and high prices.
My personal experience was a substantial reduction in my homeowner’s premium when the condominium roof on the building I live in was recently replaced. This was because the replaced roof met the Florida code for wind velocity and then some. It was nice while it lasted, but at the next renewal, the premium was increased, wiping out all of the savings from the roof replacement.
My view is that even if legislation had been passed, can you really force companies to do business in the state? Companies are going broke or making business decisions to move their businesses out of Florida. It’s a monumental problem that will require some creative thinking in Tallahassee during the next legislative session. Tort reform and other reforms that would have better control of litigation would go a long way to help insurance companies that are leaving the state to take another look.
For now, however, we’re done, and homeowners will have to just deal with double-digit increases in their homeowner’s policy at renewal, as well as the possibility of having a new roof installed so they will actually qualify for insurance. The legislature could call a special session to take another look – a very good idea – but one that is rarely done. The state saw this coming and kept kicking the can down the road, and as usual, it’s the least wealthy among us who will be hurt the most.
I wish there were more encouraging news, but there’s not. My advice is to write to your legislator, replace your roof if you’re in a position to do so and don’t shop for another insurance company. If your current company has renewed your policy, just be happy; don’t be a fool in April.
