What would you do if your homeowner's insurance spiked 49% or more? Unfortunately, this could soon be a reality as many Florida homeowners' insurance providers are looking to raise rates soon.
Florida has a problem with "dubious roof claims," and it's about the cost homeowners who live in the Sunshine state big time. Insurance claims and payouts for roof repairs have more than doubled in Florida over the last three years.
Apparently, it has become a common practice for some Florida construction companies to offer "free roofs" to customers because they end up making a profit from the insurance payout. Homeowners are also heavily targeted by the companies following storms and other weather events.
If the insurer refuses to pay the claim, the construction company may hire an attorney who is usually able to get the property insurer to pay out some amount toward the claim rather than continue to be involved in costly litigation.
This practice has caused Florida to lose at least three private insurance companies, with some estimates as high as five because they cannot afford to continue paying out claims at this rate.
Due to what is now being called a "property insurance crisis" throughout the state of Florida, insurance agents have very few options to offer customers, and many come with very high premiums.
The insurance companies who have managed to stay in business claim that they must raise rates on homeowners to keep the lights on.
According to recent reports, First Floridian Auto and Home anticipates raising rates by approximately 23%. At the same time, Florida Farm Bureau claims that it may need to raise rates by as much as 49 percent to keep up with demand.