Florida’s challenging property insurance market is seeing a significant shift with the approval of two new providers, Incline National Insurance Company and Florida Insurance and Reinsurance Company. This expansion, bringing the total new entrants to 14 since 2022 reforms, signals a potential stabilization and increased competition, offering a glimmer of hope for homeowners grappling with high premiums.
Florida’s Evolving Insurance Landscape
Florida’s property insurance market has been notoriously volatile, marked by high premiums and limited options. However, recent legislative reforms in 2022 and 2023 aimed to curb excessive litigation, which insurers blamed for escalating costs. These reforms have led to a dramatic decrease in lawsuits against property insurers, paving the way for new companies to enter the market.
New Players Emerge
The latest additions, Incline National Insurance Company and Florida Insurance and Reinsurance Company, are the 13th and 14th insurers to be approved since the reforms. Incline National, with over 75 years in business, plans to offer a broad range of coverage statewide, including homeowners multi-peril and allied lines. Florida Insurance and Reinsurance Company will primarily focus on condominiums and multi-tenant office buildings, also specializing in reinsurance products.
- These new companies benefit from a "clean slate," unburdened by pre-reform claims and lawsuits.
- Many new entrants participate in the depopulation of state-owned Citizens Property Insurance Corp., reducing initial acquisition costs.
Signs of Stabilization
State officials are optimistic about the market’s recovery. Data indicates a positive trend:
- Profitability: Florida-incorporated and headquartered companies reported a net income of $944 million in 2024, a significant increase from a $741 million net loss in 2022.
- Rate Adjustments: Since January 2024, 27 companies filed for rate decreases, and 41 requested no change or a 0% increase.
- National Comparison: Florida recorded the nation’s lowest average homeowner premium increase in 2024, at just 1%, a stark contrast to previous years where it was among the highest.
Challenges Remain
Despite the positive outlook, challenges persist. While the overall trend points to stabilization, some insurers are still seeking significant rate increases. For instance, Trusted Resource Underwriters Exchange (TRUE) recently requested rate increases of up to 31% for its multiperil homeowners’ insurance. Homeowners may also see premiums climb even with dropping rates if their home’s value increases due to inflation.
Furthermore, some lawmakers are pushing to reintroduce certain attorney fees in litigated claims, which could potentially reverse some of the positive impacts of the 2022 reforms. The full impact of these new insurers on the market, especially in high-risk areas like South Florida, remains to be seen, as many new companies prefer to avoid heavily writing policies during hurricane season.
Sources
- Two New Property Insurers Approved, | Florida Realtors.
- Florida property insurer wants to increase rates 31%. More to come?, The Palm Beach Post.
- Here’s what homeowners need to know about Florida’s new insurance providers, WPTV.