Hurricanes may be a way of life in Florida, but natural catastrophes have changed and raised the price of insurance against catastrophic damages. On July 1, changes to Florida’s insurance law could have a serious impact on homeowners by making it harder to file legal action against insurers and limit what insurers pay for roof damage, among other things.
Reasons
It has become more expensive to insure homes against the changing nature of catastrophes. Also, insurers must spend more money defending claims, investigating possible fraudulent claims, and confronting illegitimate or false claims.
Insurers have sought to recover these costs by increasing the price of homeowners’ policies. This law was approved last month.
Expected changes
Homeowners may have more choices for homeowners’ insurance and coverage. Insurers that left Florida may return. It is hoped that the law will produce a more viable private insurance market in the state by establishing certainty and reducing fraud, and lawsuits.
The rates for the public insurance option or insurer of last resort, Citizens Property Insurance, will increase under the new law. Before the law was changed, rates were anticipated to rise 10 percent annually.
The new law will allow these rates to increase by 11 percent then 12 percent the following year. This intended to provide more options and encourage insureds to leave Citizens and enter the private insurance market.
A healthier insurance market in Florida, according to an expert, may not immediately bring reduced premiums. Insurers are waiting to see if the costs of doing business in this state fall. Prices may drop for consumers if insurers can control the costs of providing coverage and dealing with fraudulent claims.
Attorneys can help homeowners and property owners deal with their insurers after they suffer catastrophic losses. They can help pursue claims and protect legal rights.