ORANGE COUNTY, Fla. — Just about everyone on Ridgecrest Road in Orange County’s Fern Creek district has a story about their property insurance.
The area was heavily damaged by Hurricane Charley in 2004, and again by a tornado that ripped roofs off homes in 2020.
With contractor signs dotting the neighborhood – the few remaining signs that destruction ever happened – homeowners found themselves dropped by their insurance companies or staring at significantly higher rates.
“Once they ask you about the zip code, then you’re pretty much done,” Matthew Richards described.
Due to storms like those, Florida’s property insurance industry is imploding. Rates have risen more than 30% since 2016, analysts said, more than three times the national average. The commonly cited cause is the number of lawsuits filed by scam roofing contractors who go door-to-door, offering free estimates and replacements.
After they find minimal damage, insurance companies foot the bill or fight it in court.
“I’m a big proponent of if an insurance company does something stupid, they should get sued for it,” FL Insurance Commissioner David Altmaier told reporters in late March. “That’s not really what we’re seeing.”
State lawmakers have been working on possible fixes to the crisis for years, but solutions took a back seat to culture-war issues during the 2022 session.
InsuranceQuotes.com Senior Analyst Michael Guisti said no matter what, homeowners are going to have to pay more.
“We don’t want a situation where we try to force private businesses to write a product that’s just not going to be profitable,” he said.
He proposed a handful of solutions, from continuing to let the free market dictate prices to adopting Miami standards state-wide, which require stronger roofs and more frequent replacements.
Lawmakers have been looking at another array of options, including allowing insurance companies to offer deductibles for roofs or allow them to not pay to replace roofs older than a certain age. Altmaier said whatever is implemented will be presented to customers upfront to avoid unpleasant surprises.
Any solution, he said, would have to make roof repairs less appealing to scammers, like the state did with mold back in the day.
“Once you put a $10,000 cap on mold claim, suddenly, nobody had a mold claim anymore,” he said.
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