Florida homeowners insurance has become one of the most talked-about issues in Central Florida real estate. Whether you are buying, selling, or simply staying in your home, understanding the current landscape can save you thousands of dollars and prevent deal-killing surprises at closing.
Why Florida Home Insurance Costs Have Risen
Florida has experienced a dramatic shift in the property insurance market over the past several years. Multiple carriers have left the state or stopped writing new policies. Those that remain have raised premiums substantially, particularly in areas prone to hurricane and flood risk.
Several factors are driving these increases. Litigation costs in Florida have historically been among the highest in the nation for property insurance claims. Reinsurance has become more expensive globally. And the frequency and severity of named storms continues to shape how underwriters price risk in the state.
For homeowners in Orange, Seminole, Osceola, and surrounding counties, annual premiums that were once in the $1,500 to $2,500 range have in many cases doubled or tripled.
Citizens Property Insurance: The Insurer of Last Resort
Citizens Property Insurance Corporation is the state-backed insurer designed to serve homeowners who cannot find coverage in the private market. As private carriers have pulled back, Citizens has grown significantly.
Citizens is not necessarily the cheapest option. Its rates are required by law to not be so low that they undercut private carriers. But for many homeowners, it is the only option available.
If you are a Citizens policyholder, be aware that the state has a depopulation program. Private insurers can take out Citizens policies, moving you to their books. When it happens, you receive a notice and have the right to remain with Citizens only under specific circumstances.
What Buyers Need to Know Before Closing
If you are purchasing a home in Central Florida, line up insurance quotes early in the process. Do not wait until two weeks before closing to discover that the home you are buying requires $8,000 per year in insurance or that no carrier will write a policy without a roof replacement.
Get at least three quotes from different carriers or through an independent insurance agent. Ask about the roof age, material, and condition. Check whether the property is in a flood zone. Ask the seller for their current insurance declaration page.
What Sellers Should Do Before Listing
Insurance is increasingly becoming a factor in whether a deal closes. If your roof is more than 15 years old, consider getting a roof inspection before listing. If you have made improvements that reduce insurance risk, gather that documentation.
My Safe Florida Home and Discount Programs
The state of Florida offers the My Safe Florida Home program, which provides free wind inspections and grants of up to $10,000 for eligible homeowners to make wind-resistance improvements.
Completing a wind mitigation inspection can result in significant insurance discounts. The resulting form is submitted to your insurer and can reduce your premium by hundreds or even thousands of dollars per year.
The Bottom Line
Insurance is no longer a background line item in Florida real estate. Buyers, sellers, and agents who understand the current market and plan ahead will have a significant advantage.
If you are buying or selling in Central Florida and want to understand how insurance costs may affect your transaction, contact Sloan Properties.
