Allstate and others finally abandoning Florida?

[Downdraft]

Well, I can see both sides of the problem. Insurance companies are businesses and need to make money. Homeowners have houses and need insurance. Personally I think before we crucify the insurance companies we need to throw some of the responsibility back on the homeowners in the form of mitigation efforts. This stupid attitude of I don't have to do anything to protect my home because FEMA or the insurance company will make it all better again is insane. Insurance should be predicated on the efforts made by the homeowner to protect his/her own property. Examples being roof reinforcement, shutters, generators, garage door reinforcement, etc. The more safety features your car has the lower your insurance why not the more hurricane features your home has the less your insurance too.
Peronsally though on another note if you want to build a million dollar home with nothing between you and the Atlantic ocean but 50 yards of sand I think the monkey is on your back not the insurance companies or the state or FEMA.

[Zackiedawg]

There simply aren't any sure fire ways to stay insured in a hurricane-prone area anymore. And there is no way to prove that insurance companies are pulling out because of 'losses'. It may just be that they no longer want to expose themselves to any risks, and would like to maintain the same level of profitability as they have become accustomed, and the CEOs do not want to give up their $7 - 15 million per year incomes.

Any one household's particular risk is not currently taken into consideration, and whether or not you have ever filed a claim is not considered. For example: We were canceled by Allstate in 1993 following Andrew...this despite the fact that we live 80 miles north of where Andrew struck, and suffered no hurricane effects at all.

A claim has never been filed on my house since it was purchased new in 1979. The house has been retrofitted with hurricane straps in the roof, reinforced doors, steel garage door with hurricane rods, laminated hurricane glass and window frames, and exterior landscaping was removed which could impact the house. The house sits on a natural rise, and is not susceptible to flooding. The house is 5 miles from the coast, and outside of the storm-surge estimates for this area...it is not in a mandatory evacuation zone.

Despite all of this, our rates with State Farm have continued to rise, especially after hurricanes Frances and Jeanne last year. Again with Wilma, we are facing a very likely increase...if they don't decide to pull out altogether. We must accept a $17,000 deductible as a percentage of the home value, and have been given 3 different amendments to the coverage which have excluded certain parts of the house or grounds from claim eligibility. Not to mention the fact that our insurance rates are significantly higher than most of the country already.

Yet, we have never cost the insurance company a penny. And when I lived in the Los Angeles suburbs from 1990 to 1994, my insurance was significantly better and cheaper than it is here, despite the extreme claims risk from earthquakes, fires, floods, and landslides (Until Katrina, the most costly disaster in the U.S. had been the 1994 Northridge Earthquake (more than hurricanes Charley, Frances, Ivan, and Jeanne combined). My father still has a home in Burbank, CA, situated in the same fault network that created the most costly disaster in US history before Katrina...yet he is able to maintain a $600,000 home with a $3K deductible and pay 1/2 the premium as I do. Not to mention that he lives in the foothills of the San Gabriel mountains, in dry scrub brush, on a cliffside - highly susceptible to both fires and landslides.

So why is it fair to only penalize the people living within hurricane strike zones when their disaster likelihood is no more than many other parts of the country, and in fact our preparations are often greater than many other places in the event of a hurricane, limiting the amount of damage done and thereby limiting claims, versus a hurricane striking a less prepared state with less stringent building codes?

I often see posts about how those living along the gulf or Florida coast are somehow causing others in the country to suffer higher rates to pay for our disasters...yet a look at FEMA's claims still show the 1993 midwest floods and the 1994 Northridge quake on the top-10 chart alongside the hurricanes we all complain about. Not to mention that FEMA paid claims during hurricanes Georges, Ivan, Frances, Jeanne, Charley, Allison, and Hugo in many other states besides Florida - NC, SC, VA, AL, MS, LA, PA, TX, GA, TN, NJ, NY, WV, OH, and DE all received FEMA claims in one or more of those storms, and surely had insurance claims. There may be people living in flood-prone valleys in Pennsylvania that have made claims to their insurance company in as many as 4 hurricanes in the past 10 years...ranging as far as total destruction...who are still able to reinsure and still pay significantly lower rates than someone in Florida who has never made a claim.

Unfortunately, Florida won't get any favors. There are plenty of benefits of living down here, and people are more than willing to make the tradeoff. Certain areas of South Florida are so wealthy that no rate increase or even pullout in insurance will ever prompt them to sell and leave. They like it down here, can afford to live here, and are willing to accept the risks. It is nearly impossible to get insurance on gulf coast and Carolina barrier islands, and in most cases highly expensive and stripped down state insurance has been implemented...yet there hasn't been a mass exodus from these areas. So I wouldn't expect to see alot of people fleeing Florida with the private insurers, unless they are the poorer, working class folks who simply cannot afford to live here anymore. Florida's coasts are already mostly a playground for the rich, and likely will only become moreso as costs continue to rise.

[johngaltfla]

I fear we are only starting to see the precursors of what's about to happen. Just have a 1926 style storm hit Tampa or Miami and watch what happens.

Florida will depopulate rapidly.

[Loring]

Yes, but what about when the working class leaves. i dont care how much money you have, if the people who SERVE YOU, cant afford to live, you cant have a community.

If people cant afford to ring up your groceries, service your vehicle, or police your streets, you CAN NOT live. this isnt strictly a financial thing.

I know were keeping politics out of this thread, but take a GOOD look at the libertarian party.

/politics


If everyone were to pool together all the time, and not just in times of need in the form of a donation to FEMA or a charity organization, we might not be facing this. Just because an insurance company would be forced to sell homeowners/flood alongside auto, doesnt mean that they'd have to make it affordable. If taxes were reduced or another worthy incentive was given to donate, say a quarter or a dollar a day to someone like FEMA, their emergency reserve would be in such surplus that they could afford the staff and claims and pay out quickly and effectively.

...IF everyone participated. the incentive needs to be there, however. if it was such a commonplace thing that everyone budgeted for it (or disregarded it), just like social security, and medicare and other paycheck deductions, there would be little complaints, especially for those making a decent wage.

If you spread the loss across the whole country, the blow is reduced to an insignifigant amount. Furthermore, if FEMA did cover all major disasters regardless of insurance coverage, not only would insurance be a LOT lower (not to mention the cancellations), the 'premiums' donated by the citizens would be controlled by the government, and the insurance company high roller CEO's finances would be out of the picture. Thats more than enough incentive for me.

[cyclonekiller]

This is precisely why I am leaving. I had to get Citizens State insurance because NO ONE would insure my 20 year old wood frame house. So, I pay $2369 for my policy and last year I paid $1300. You can't have a mortgaged home without insurance. Now, Citizens is asking for ANOTHER MONSTER increase.. so next year it should be AT LEAST $3500 for insurance.

We are leaving because we are priced out of here. I have a tiny mortgage, but it isn't tiny once you had $200 a month for insurance. I have never even had a claim.

I am disgusted and there will be a year really soon that the only insurance is the state and it will be thousands and thousands and only the wealthy will live here.

This is another thing my tunnels would prevent.

[vbhoutex]

This is precisely why I am leaving. I had to get Citizens State insurance because NO ONE would insure my 20 year old wood frame house. So, I pay $2369 for my policy and last year I paid $1300. You can't have a mortgaged home without insurance. Now, Citizens is asking for ANOTHER MONSTER increase.. so next year it should be AT LEAST $3500 for insurance.

We are leaving because we are priced out of here. I have a tiny mortgage, but it isn't tiny once you had $200 a month for insurance. I have never even had a claim.

I am disgusted and there will be a year really soon that the only insurance is the state and it will be thousands and thousands and only the wealthy will live here.

This is another thing my tunnels would prevent.

The tunnel discussion is over!! End of report!!!