Since 1980, the U.S. has experienced 378 weather events that resulted in damages exceeding $1 billion, according to NOAA. Cities like Hialeah, Miami, Fort Lauderdale, Hollywood, and West Palm Beach are among those facing high risks of natural disasters and consequently paying some of the highest insurance premiums.
Home insurance premiums are anticipated to continue increasing until 2024 and beyond, partly due to the severe weather conditions experienced in various regions across the nation. Insurify’s data revealed a significant 20% spike in household insurance rates from 2021 to 2023, with an additional 6% rise expected by the end of this year.
Homeowners in Florida and Louisiana are facing the highest insurance rates nationwide, with projected increases of approximately 7% and 23% respectively over the upcoming year. Colorado State University’s latest hurricane forecast indicates that these states are among the top three most vulnerable to tropical cyclones during a La Niña phase.
Despite the fact that Florida, also known as the Sunshine State, has managed to avoid any major catastrophic disasters during the past few hurricane seasons, a significant number of insurance providers have decided to withdraw from the state. As a result, homeowners are now left with no choice but to depend on the state-run Citizens Property Insurance Corp. The average insurance rate in Florida is estimated to be around $11,000 per year. However, if the proposed rate increases are given the green light, this figure could potentially rise to approximately $12,000, as reported by Insurify. Insiders from the insurance industry suggest that the crisis cannot be solely attributed to extreme weather conditions.
The scarcity of insurance options in the third most populous state can be attributed to reinsurance, fraud, and a housing crisis. Alongside attempts to entice more insurers, various governmental suggestions have been proposed to alleviate the financial strain on homeowners with mortgages. Among the state’s coastal areas, six out of the top ten cities with the highest homeowners insurance costs can be found. Hialeah and Miami rank at the top of the list, reflecting the communities with the most expensive premiums.