Will Floridians Ever See Insurance Relief?

Charley, Frances, Jeanne and Wilma, just to name a few. No, I'm not talking about the politicians, at least not just yet. These are hurricanes that ran across Florida in 2004 and 2005. These and many more were to change the lives of millions of Floridians as well as anyone else in their path. In their wake, they left death and destruction, not unlike that of Andrew and Katrina. What everyone knew in the back of their minds that could happen, but probably wouldn't, was and has continued since then. Sky-high insurance rates.

Most home owners are required to carry insurance. In Florida, you have to carry hurricane insurance as well. This makes up the largest part of the total premium. Then there's the deductible in the event of a hurricane. In most cases, this equals 2%-5% of the appraised value of the house. 2% doesn't sound like a lot, but when you have a $200,000.00 house, that is $4000.00 that you have to come up with before the insurance company will pick up their share. If it is 5%, that is$10,000.00. That is a lot of money. Money that is hard to come by, especially after your home has been destroyed by a hurricane. The insurance company then will decide how much you will get for your damages. The amount of coverage is not the amount that you will get if your house is destroyed. This sounds like a scam to me, but it all legitimate. Still no relief in sight.

The politicians, which were running for office, all made promises that they would reform the insurance debacle in Florida. Finally, there was a glimmer of hope for relief. But, like so often happens, the lobbyists managed to get their money into the right pockets, and the reformation did not occur. Most people believed that the officials they elected would carry through on their promises. After all, they were 'promised' that there would be a solution, and that it would happen this year. Well, after 2 special sessions, costing countless hundreds of thousands of dollars, there has been no solution. Only a couple of things have happened where home owners insurance is concerned. The large companies have either stopped writing new policies, or decided not to renew others. And Citizen's Insurance Corp, the state run insurer of last resort, has now become the largest insurance company in the state. There truly is no relief in sight.

When you think about how much money the insurance companies have taken in over the last three years, it is mind boggling. Then, they had to pay out several billion combined for consecutive above normal hurricane seasons. In 2006, they posted billions of dollars of profits. Go figure. And the rates are still going up, and so is the foreclosure rate in Florida. July of 2007 saw the state come in 2^nd to California in foreclosure filings. And the rates continue to go up. Obviously no relief to be seen by Floridians.

At this rate, the banks that have taken back the houses in foreclosure will have to act accordingly. It takes so long for them to recoup some of their money, that they will be put into dire straits. There probably will be less money to lend, and what they do have to lend will be scrutinized so that only those with the best credit will get it. It is a trickle down effect, from the bank to the home owner to the person asking for a loan to the people looking to purchase a home. No one can afford much anymore, except the elected officials that made the hollow promise of insurance relief. Not happening. Not today, tomorrow, or any day soon. Just hope we don't have any severe hurricanes hit Florida this year or next. I may be one of those packing my things and moving to the north. I can see that happening before any there is any relief from insurance rates.