Thursday, December 13, 2018

Florida Homeowners Insurance Competition

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There is more competition for homeowners insurance in Florida since 2006.  Back in 2006 homeowners were challenged with back-to-back multiple hurricanes.  Insurance companies became overwhelmed with claims and depleting balances.  Many declared bankruptcy.  Others simply fled for their lives and never came back to Florida.  Since then, approximately 12 A-Rated companies specialize in the provision of Florida homeowner’s insurance.  Most do not “bundle” with auto policies since they do everything they can to stay healthy enough to strictly cover hurricane claims.  These A-Rated firms have now lived through Irma and Michael and remain strong.

However……recent competitors have come into the market.  At first I was appalled at how they are competing and undercutting the A-Rated firms I represent.  Now I am taking a second look at their business plans with a bit more respect.  I even now represent a few top contenders.

Water damage claims represent 80% of all homeowner’s insurance claims.  About year ago I noticed the new insurance company competitors were eliminating water damage coverage altogether, thus offering incredible premium discounts that the A-Rated companies could not beat.  Policyholders were not aware that their new insurance company was not insuring against water damage. This prompted the A-Rated companies to first act with better public education.  You probably aren’t surprised that the #1 criteria people use to shop for insurance is “price!” 

Some of the A-Rated insurance companies started offering “limited” water damage coverage.  The average water damage claim in Florida is $12,000.   So the A-Rated companies now offer a limited water damage claim limit of $10,000.  Not quite the average, but still results in rather large premium savings. 

If you are one of the insurance price shoppers and willing to accept a limit on water damage, please give me a call.  I would be happy to provide you with options that honestly reduce your coverage, but provide even more savings. 

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