Homeowners in Florida may be facing elevated insurance costs, a change linked to an insurance provision in the state called Assignment of Benefits, or AOB. According to experts, the elevated rates are not linked to increased payouts due to storms, floods or other homeowners' claims. Instead, AOB allows homeowners to transfer the rights to their benefits to a third party. In most cases, this third party such as a roofer or contractor accepts the assignment as payment for work on a damaged home.
With the National Flood Insurance Program scheduled to expire at the end of November, Florida Sen. Marco Rubio has pursued a six-month reauthorization from Congress. Many homeowners in the Sunshine State rely on this program that finances flood insurance in areas prone to flooding. The senator urged his colleagues to vote on the insurance extension bill as soon as possible and spare property owners from uncertainty.
The costs of Hurricane Michael keep going up for Florida homeowners who were hit hard by the storm. Estimates of the damages caused by the hurricane in the Panhandle have been revised upwards to over $12 billion. That figure is twice the initial estimates made by analysts from the insurance industry. In addition, weather experts say that the hurricane might have been a category 5 storm rather than the category 4 designation it initially received.
Homeowners in Florida may be increasingly encouraged to purchase flood insurance even if they do not reside in a high-risk area. On Oct. 29 at the annual meeting of the Property Casualty Insurers of America, insurance commissioners for the state as well as for Tennessee and South Carolina said that agents and carriers may need to start pushing customers toward this kind of protection.
Residents who live in Hollywood, Florida, and other areas impacted by Hurricane Michael know all too well the devastation that occurred during and after the storm passed. Some officials have compared the destruction to that of Hurricane Andrew, but there are others who believe that the damage only extends as far as the core destruction zone.
Homeowners are facing serious losses after Hurricane Michael hit the Florida Panhandle and surrounding areas in October. According to Florida's Office of Insurance Regulation, the total estimate of insured losses from the hurricane have reached $2.1 billion so far, a number that is expected to rise. The state agency said that as of Oct. 30, there were 110,183 insurance claims filed in relation to damages caused by the Category 4 storm. However, only 26.1 percent of those claims had been closed by the time of the report, which collected data from all insurers operating in the area.
The Florida Office of Insurance Regulation has posted some preliminary numbers about the insurance claims resulting from Hurricane Michael. Close to 100,000 claims have already been submitted by people whose properties suffered damage in the category 4 storm that hit the state on Oct. 10.
Homeowners in Florida may want to review their insurance policies whether or not they were personally impacted by Hurricane Micheal. This is because previous hurricanes have led to rate increases by insurance companies no longer operating in the state at all. According to the owner of one Tampa insurer, changes made since 2004 make such extreme scenarios unlikely. New companies coming into the market may provide consumers with the ability to shop around if their rates do go up.
Policyholders in Florida have the legal right to expect insurance companies to act in good faith when processing or investigating claims or making payments. This is because insurance companies often have the upper hand because of their vast resources, experience, firsthand knowledge of policy wording and negotiating strength. Should an insurance company fail to act in good faith, it may be possible for an affected policyholder to take appropriate legal action.
As Hurricane Michael approached the state of Florida, insurers of homeowners stopped writing new policies. The last company to suspend policy writing was Citizens Property Insurance on Oct. 8. The company has around 443,000 customers.