Skip to main content

Florida’s insurance market

 Florida continues to impress. The reality that the new hurricane season has launched its first name and then a tropical storm that dumped more than a foot of water onto the stage, made the whole issue of insurance even more relevant since people are starting to lo your claims for losses as we speak. 

The reality is that in 1992 the state of Florida with see about one $1 billion claims event every four years currently the state sees between one and three such claims piranha. The implication is that the rates need to Reflect the greater call on the insurance companies reserves.

Between 1992 and 2024, almost 2 dozen Country wide in entrance companies quit the state or went into receivership. The reality of the insurance industry is that it can only survive as long as it’s reserves are there once these have been exhausted. The company has to shut its store. This happened with greater frequency over the past few years, and those companies have been replaced by local players with my higher concentration of risk into Florida.


 This happened with greater frequency over the past few years, and those companies have been replaced by local players with my higher concentration of risk into Florida.


Failure of the states to meet its entrance requirement is both man-made and regulatory driven. There is no doubt that there has been almost 30 years of neglect in the sector and only once the situation has become untenable has the government tried to take action.


Failure of the states to meet its entrance requirement is both man-made and regulatory driven. There is no doubt that there has been almost 30 years of neglect in the sector and only once the situation has become untenable has the government tried to take action.

Since the beginning the problems been that creating an organization By Fiat is fraud with risk because doesn’t take consideration the total financial exposure that these new organization are forced to take. A problem for someone else obviously. For homeowner The tragedy is that they need insurance otherwise the value of their asset false to zero quite rapidly because there’s no market for homes in the United States that cannot be insured.

 The tragedy is that they need insurance otherwise the value of their asset false to zero quite rapidly because there’s no market for homes in the United States that cannot be insured.

The dilemma then becomes a potential realistic crash in Florida. Already prices have started falling last year as homeowners realized that this problem had first led to massive increasing premium and then now the nonavailability of insurance is become even more of a challenge. Currently the average home insurance cost in the United States is around $2500, whereas in Florida it’s more than $10,000. Granted Florida is different. Is the state that suffers most from hurricane damage it is the first line in defence and it is the one that has seen the greatest change in its population more and more Americans have left the northeast to go to warmer weather 

In addition where in the United States the demagogy against climate change is such like a normally be discussed in polite company, the reality is that in United Kingdom, where the majority of the reinsurance market is located no queries exist. Therefore, we have seen a massive increase in the cost of Florida reinsurance. The full impact is only really big and emerging 45 years ago because reinsurance contract are multi affairs not renewable every year as normal. Homeowners insurance is follows different rules and practices.

To add insult to injury, the insurance commissioner based in Florida has I’ve given top ratings to several insurance companies that have failed over the years, reducing the value of such insurance since they have ended in bankruptcy anyway. Again, the driver there is state policy stops this group from considering the climate change as a factor in this market.

i’ve given top ratings to several insurance companies that have failed over the years, reducing the value of such insurance since they have ended in bankruptcy anyway. Again, the driver there is state policy stops this group from considering the climate change as a factor in this market

What is to be done? well that is the interesting question and there is no easy answer. Either the first obvious problem is building standards in Florida such that it is easy to build homes which are at best hurricane resistant, as opposed to hurricane proof. The second issue is that water evacuation is not taking seriously at a very micro level so that the building structure can be retained and not be destroyed because the majority of cases it is the water rather than the winds and storm that damage the structures to a point where they have to be demolished and then rebuilt, for such thing occur, there would need to be a policy shift and the capital of Florida.

It is a fundamental truth that to find a solution. You have to recognize the age of the problem. The problem is that the policy makers in Florida refuse to see the obvious problem and if you are unable to see the problem, there’s almost no way to find the right solution, it is literally a Greek tragedy 

Comments

Post a Comment

Popular posts from this blog

Ok so I lied...a little (revised)

When we began looking at farming in 2013/14 as something we both wanted to do as a "second career" we invested time and money to understand what sector of farming was profitable.  A few things emerged, First, high-quality, source-proven, organic farm products consistently have much higher profit margins.  Secondly, transformation accounted for nearly 80% of total profits, and production and distribution accounted for 20% of profits: Farmers and retailers have low profit margins and the middle bits make all the money. A profitable farm operation needs to be involved in the transformation of its produce.  The low-hanging fruits: cheese and butter.  Milk, generates a profit margin of 5% to 8%, depending on milk quality.  Transformed into cheese and butter, and the profit margin rises to 40% (Taking into account all costs).  Second:  20% of a steer carcass is ground beef quality.  The price is low, because (a) a high percentage of the carcass, and (b)...
Post a Comment
Read more

Spray painting Taylor Swift G650 aircraft (updated)

 First, a bit of paint will not harm anyone.  These climate activities are going to learn two things in the next few days:  (1) Trespassing at an airport is a felony almost anywhere in the world.  That means criminal prosecution.   (2) removing paint from an aircraft is expensive.   So these climate activists are about to find out the reach of the British criminal system and it will not be pleasant, the UK has very strict laws about that, I would be surprised if cleaning the aircraft of all the paint will cost less than $100,000.     I am sure that when they planned (premeditation) this little show they had a very valid logic to doing this.  Tonight, they are probably realizing the depth of their troubles.   I understand that in the UK it's a minimum one-year jail sentence.    Also, good luck travelling with a criminal trespass charge against you.  I am relatively certain that the airline industry will ...
Post a Comment
Read more

Janet Yellen from China supporter to Hawk...

There is rarely serious news in the world these days, it seems that most newspapers are filled with headlines and little else, and then Ms Yellen went to China.  Secretary Yellen has long been known in the Biden administration as the voice of moderation when dealing with China, yet as her trip which concluded yesterday a hawk was born:  She warned the Chinese against dumping goods in the United States.    fighting words! The American administration is very concerned about the lack of Chinese domestic consumption.   Even before the COVID-19 epidemic, there were already the beginning signs of a slowdown, automobile sales were off.   China is facing domestic deflation (a clear sign of collapsing demand) China imports few consumer goods, they import raw materials and intermediary goods.   It seems that the American administration is concerned that the Chinese administration will dump consumer goods abroad to keep its manufacturing machinery ...
Post a Comment
Read more