I live in Florida and a ton of people are moving here. Even so, there are a ton of property insurance companies pulling out of the state. It makes no sense to me.
In: Economics
It’s a combination of factors.
The big one is that despite Florida have 6.4% of the US population, and 9% of all house insurance claims, upwards of 79% of house insurance lawsuits are from Florida…
Florida has weird State laws regarding Insurance companies making it very hard for them to deny claims or fight against them.
Meanwhile Florida is being hit hard with climate change. Natural disasters (particular Hurricanes and flooding) are common place forcing rates to be higher. Insurance companies know full well that they can’t afford to pay out every house in a city if the mother of all Hurricanes hits.
The State is also a notorious hotbed for real estate and insurance fraud. People will often differ maintenance on their homes like getting new roofs and windows knowing that a Hurricane will hit eventually, then that they can blame it on a hurricane and get it paid out by the insurance.
Seeing as how much a nightmare it is to deal with Florida residents many insurance companies have resorted to just refusing to issue policies in the State, which further drives up the costs of insurance.
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