Many people dream of living in the sunny state of Florida, especially in the bustling city of Miami. The Florida real estate market is booming, but many homeowners looking to relocate are shocked to learn of the recent rise in real estate insurance costs.
Currently, Florida is the most expensive state in the nation in terms of home insurance costs. Buyers are now experiencing “sticker shock” when shopping for homes, and homeowners are expected to pay an average 21 percent increase compared to 2018 rates this year. If you’re considering a move to Florida but are worried about rising insurance premiums, you may be looking for “estate lawyers near me” to learn about your options. Look no further! Arturo R. Alfonso, P.A. is here to help.
Factors Contributing To The Rise In Real Estate Insurance Costs
A few things negatively affect insurance rates in the state, but the most prominent are increasing carrier losses and the rising cost of reinsurance. Natural disasters are one concern, with Hurricane Irma (2017) and Hurricane Michael (2018) alone generating nearly $30 billion worth of claims. This, along with the increasing cost of “reinsurance,” or insurance taken out by insurers themselves to cover their risks, is causing premiums to increase.
Insurance Litigation Is Taking Its Toll
In addition to increasing reinsurance costs and insurance claims, insurers claim that excessive litigation is also taking a toll on premiums. Many insurers see these lawsuits as illegitimate. This may be because, in 2019, Florida residents made up just eight percent of all homeowners’ insurance claims nationwide, but 76 percent of home insurance lawsuits!
Many of the claims that insurance companies are questioning involve roof damage from storms. While this would be consistent with the fact that Florida sees a lot of damage from hurricanes each year, adjusters commonly conclude that the claimed damage is caused by normal wear and tear.
What Can Be Done?
Some say that current laws in Florida allow “too-easy” access to insurer-paid legal fees in cases of litigation. Critics of this law claim that it encourages homeowners to file “frivolous” lawsuits over denied claims. To attempt to combat this, some lawmakers are considering bills to limit attorney fees, which proponents say would reduce incentives for these types of lawsuits.
Critics of these bills, however, argue that this would hurt policyholders and limit the legal recourse they have against insurance companies. They claim that the insurance industry exaggerates the role of insurance fraud, so they don’t have to address the significance of losses related to natural disasters.
While the real estate market in Miami is still booming, rising premiums on homeowners’ insurance are threatening it. If you’re considering purchasing a home in the area, you may be searching for “estate lawyers near me” to help you understand what you can do to pay only a reasonable amount. Whether you are a longtime Florida homeowner or a prospective buyer, an attorney can help you understand these rising real estate insurance costs.
The real estate boom is in jeopardy, and you may not have the experience required to understand why. Instead of searching the web for reputable “estate lawyers near me,” contact Arturo R. Alfonso, P.A. today.