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Environment

Hurricanes: Tips on Homeowners' Insurance

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NOAA.gov

Florida’s private homeowners’ insurance market is “the worse it’s ever been” in the past five years according to Michael Letcher, president of the Home Insurance Buyers Guide.

“To me, the health of the market isn’t how many policies are available in the private market but what kind of choice does a customer have and what kind of ability do we all have to shop our policies,” Letcher said.

Letcher had his home insurance canceled after Hurricane Wilma when his insurance company left Florida.

And the difficulty of finding a financially sound insurance company afterward prompted him to create the online homeowners insurance guide.

He said overall there are about 92 companies in Florida’s private insurance market that have active policies. But, only 40 are writing new business. That means on average there are only about two dozen companies writing new policies in any given county and restrictions further narrow consumer choices.

“Many Floridians at most have three to five choices at best,” Letcher said. “I’m concerned that we’re really at a tipping point here. We’ve really got to do something to make sure that that private market continues to grow.”

Letcher said it’s up to each homeowner to decide their risk. He offered some suggestions on what to look at in your policies:

  • Look at your deductible for your general insurance coverage (not hurricane coverage) and calculate how much you would save with a higher deductible.
  • Look at your sink hole coverage. He cautions that you should do detail research to find the closest sink holes in your region before considering dropping this coverage.
  • Calculate if it is worth the risk to drop coverage on your “other structures” like screen enclosures or outlying buildings.
  • Examine your extra coverage, insurance riders, on items like jewelry and see if there are any savings.

What Letcher cautioned against is taking a 5 or 10 percent deductible for hurricane insurance, most are set at 2 percent.
“Personally, I wouldn’t do it because for those of us who have been through the claim process, we know that there are always hidden things that come up, hidden costs,” Letcher said.

Consumer Reports also offers an insurance buyers' guide.