Without further ado, let´s jump straight into the hottest topic on the “insurance street” and how it affects the buying and selling off property in 2024.
Flood requirements by Citizens, as most of you know right now, one of the biggest carriers in Florida is Citizens. This is NOT due to their great policies, but instead, due to their artificially suppressed premiums. At first, that sounds great. However, when you look past the premiums, it presents several problems. Especially when you consider the fact that Citizens is an unrated government owned insurance company, who doesn’t want to be in the insurance business. Combining that with the fact that they are unable to increase their rates due to certain state filings, you can start to see the spider web of problems this presents.
The issue is further exacerbated when you take into consideration the sheer volume of claims that have been saturating the marketplace over the last 5 years, some legitimate and some not.
One of the major issues that has come about due to the number of hurricanes that we have experienced over the last few years is flooding. As most of you know, flood insurance is NOT covered in any home insurance policy and must be purchased separately, or endorsed in some cases, for coverage to apply. This is important since flood insurance is something that often accompanies hurricane damage. As you can imagine, when someone has 3-4’ of water damage in their home, and they have no flood insurance coverage, things escalate quickly, and often involve lawsuits. One way to curtail this problem is to require people to carry Flood insurance if they wish to purchase home insurance. This does two things; first, it increases the overall cost of the insurance package making Citizens less desirable, and two, it prevents the back and forth with regards to flood insurance coverage if flooding does occur.
So, starting in 01/01/2024, Citizens is now requiring all homes with a value of $600,000 or more to carry flood insurance regardless of what flood zone the property is located in. This also applies to property regardless of whether there is a loan on the property or not. This change will apply to homes with a value of $500,000 or more starting on 01/01/2025. It will go into effect for homes with a value of $400,000 starting 01/01/2026, and everyone else, starting 01/01/2027. With that said, insureds are required to carry flood insurance limits in the amount of 250,000 for the dwelling, and 100,000 for the personal property or more. If the dwelling amount is below 250,000 (Starting in 2027), you can simply insure the value of the home. On a side note, Citizens is accepting both FEMA flood and Private flood as qualifying flood insurance policies.
P.S. – Do you have a question about insurance that you want answered? Shoot us an email and we will include it in one of our monthly newsletters: info@thewelchgroup.net
P.S.S. – Need help with placing an insurance policy, give us a call as we write with just about every carrier in Florida for both personal and commercial insurance: 727 835 1500
