Why Are Home Insurance Rates Increasing In Florida?

As a Florida homeowner, you may have noticed that your home insurance premiums have been going up in recent years. This may be causing you to wonder why this is happening and what you can do to keep your insurance costs from getting out of hand.

In this article, we’ll explain why home insurance rates are increasing in Florida and what you can do to protect yourself and your wallet.

Why Are Home Insurance Rates Increasing In Florida?

Home Age

Homeowner’s insurance can increase for a number of factors but many times the increase in the premium can be attributed to the age of the home. As a home ages, systems can fail and lead to damage—and an insurance claim. By increasing your premium, your insurance company is protecting itself from your home’s increased risk for claims.

Natural Disasters

Another major reason is the frequency and severity of natural disasters, particularly hurricanes. Florida is no stranger to hurricanes, and these devastating storms can cause significant damage to homes and other structures. In fact, in 2020 alone, there were six named storms that hit Florida, causing billions of dollars in damage.

In addition to hurricanes, Florida is also prone to other natural disasters such as tornadoes, floods, and wildfires. All these events can cause significant damage to homes and result in costly insurance claims.

Cost of Building Materials

Another factor contributing to the increase in home insurance rates in Florida is the rising cost of construction and building materials. As the cost of materials and labor increases, so does the cost of repairing or rebuilding homes after a disaster. This means that insurance companies are paying out more for claims, which results in higher premiums for homeowners.

Home Insurance Fraud

Lastly, insurance companies in Florida are facing increased regulatory scrutiny, which can also lead to higher rates. The state government has been cracking down on insurance fraud and abuse, which has resulted in more expensive legal proceedings and increased compliance costs for insurance companies. These costs are ultimately passed on to consumers in the form of higher premiums.

 

What Can Homeowners Do to Keep Their Insurance Costs Down?

While there is no way to completely avoid the increase in home insurance rates in Florida, there are steps that homeowners can take to keep their costs as low as possible. Here are a few tips:

Shop Around For Insurance

Just like with any other product or service, it pays to shop around for home insurance. Different insurance companies offer different rates, so it’s important to get quotes from several companies and compare them. An independent insurance agent can help you find the best rates and coverage options for your needs. If you have multiple insurance policies, such as home and auto insurance, consider bundling them with the same company. Many insurance companies offer discounts for bundling policies.

Increase Your Deductible

One way to lower your home insurance premiums is to increase your deductible, which is the amount you pay out of pocket before insurance kicks in. Just be sure that you can afford to pay the higher deductible if you need to make a claim.

 

Improve Your Home’s Safety Features

Insurance companies often offer discounts for homes that have certain safety features, such as a security system or hurricane shutters. Consider adding these features to your home to lower your insurance premiums.

Maintain Your Home

Keeping your home in good repair can help prevent damage from natural disasters and reduce the risk of insurance claims. Make sure to keep up with routine maintenance tasks like cleaning gutters, trimming trees, and checking for leaks. Certain updates, like a new roof, can be a good investment for your home and your home insurance rate.  

Get A Home Inspection

To counter this, you should speak with your carrier (or insurance agent) about whether a professional inspection or certification of certain aspects of your home could help reduce your premium costs.

How A Home Inspection Can Reduce Insurance Costs

There are three primary inspection types most home insurance companies will accept in exchange for a potential premium reduction if the inspection reveals the home or important aspects of a home to be “in good health.” These insurance inspections are:

Four Point Inspection

This type of inspection is commonly requested by insurance agencies on homes that are over 30 years old but could prove beneficial in younger homes as well. Unlike a regular home inspection which inspects over 400 different aspects of your home, a Four Point Inspection only reviews 4 areas of your home:

  1. Roof: An age estimation is calculated, and the overall condition and life expectancy are noted.
  2. HVAC System: The age and any updates/repairs are documented. The current condition and life expectancy are noted on the inspection.
  3. Electrical: Wires and all electrical system components the inspector can access are reviewed. Condition is noted and comparison to code requirements are made.
  4. Plumbing: Areas of the plumbing system that are visible to the home inspector are reviewed and their condition, material, and obvious repairs and replacements are noted on the inspection report. The estimated age of the system is calculated and the age of the water heater from its label is also included.

By having a report made by a professional home inspector, both the homeowner and the insurance company can get accurate information about a home. Insurance companies can use this information to correct their risk calculations of something occurring (like a burst pipe or the likelihood of a roof leak) and adjust premiums and coverage accordingly.

Roof Inspection & Certification

This type of inspection is more common for homeowners to look into when their home is not over 30 years old, but they are unsure about the condition of their roof or its life expectancy—or the roof’s documented age is causing their homeowner’s insurance premium to increase. Some carriers may adjust premiums if the home is certified to last for another 5 or more years.

Wind Mitigation Inspection

This is a popular home inspection option for Florida residents, especially those who live closer to the coast. The wind mitigation inspection estimates how well a home’s roof and structure can withstand high winds (like those of a hurricane or tropical storm). Newer homes are often built with wind mitigation in mind while older homes can be renovated to include these benefits. It is common for homeowners who get this type of inspection and have a home with a good wind mitigation rating to receive a discount on their home insurance policy.

Professional Tampa Home Inspections With The Homeowner In Mind

AcuSystem Inspections has been in the business for a long time. Our goal is to help homeowners understand their home—its age, condition, how to work certain systems, and how to keep it in good condition. Our inspections are well-detailed and provide a recommended course of action (like repairs or maintenance) where warranted. If you are looking for a way to save on your home insurance policy, contact us to discuss our insurance inspections to determine which type of inspection could benefit you the most.

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