The state's insurance companies are struggling to survive an onslaught of hurricanes and litigation.
When reinsurance gets more expensive, it spells trouble for small insurance companies like the ones that dominate Florida, said Sridhar Manyem, a researcher at the credit rating agency AM Best and the co-author of a“They might have to drop some customers, they might have to raise rates, they might have to borrow more money at a pretty atrocious cost to buy reinsurance,” Manyem told Grist.
But the elephant in the room is the looming rise in reinsurance prices, which will make it even harder for Florida insurers to turn a profit next year. Reinsurance costs account for about half of the actual premiums that Florida homeowners pay, and that number is likely to rise.“Right now that doesn’t look really good for any major carriers that might be thinking about writing in Florida, or even carriers that have been writing and might be thinking about leaving,” said Born.
“It would be temporary, and it has to be contingent on getting major reforms so we actually fix the situation,” Paul Renner, the incoming speaker of the state House of Representatives,
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