Has Your Home Insurance Rate Increased? You're Not Alone.

Has Your Home Insurance Rate Increased? You're Not Alone.

It’s that time of the year. You open your mailbox and find a letter from your home insurance company, and your annual policy renewal is inside. Your new bill is $300 higher than last year. You immediately wonder why this increase has happened since you have not filed any claims and you always pay your bill on time.

The good news? You’re not alone. On average, home insurance rates have increased by 25 percent throughout the state of Florida. The bad news? Increases are likely to continue. Since December of 2019, three more carriers have approached the State of Florida Office of Insurance Regulation to propose increases between 10 and 20 percent.

Why Are Premiums Going up?
Assignment of Benefits


Many factors go into an insurance carrier’s need to charge more premium, but one of the biggest culprits is the abuse of the Assignment of Benefits (AOB) practice. AOB is a legal contract that gives a third party, such as a contractor or roofing company, permission to directly contact an insurance company on behalf of the policyholder. Once an AOB is signed, the third party can request payment from the insurance carrier and even file a lawsuit on the policyholder’s behalf without their permission.


The AOB process may seem convenient for policyholders, but in reality it has become one of the biggest challenges for the insurance industry in Florida. Dishonest contractors have been abusing this program for years, filing false claims, inflating invoices, and suing insurance companies, all on behalf of policyholders. The number of AOB lawsuits in Florida has grown 94 percent within the last five years with 153,000 filed in 2018. The additional cost needed to pay AOB claims and legal fees has forced insurance carriers to charge more premium.

The Cost of Reinsurance

Reinsurance is essentially insurance for insurance companies. By purchasing reinsurance these carriers ensure that they have the means to take on the risks they insure in the event of a major disaster. Reinsurance costs are expected to increase this year by 15-20 percent. As reinsurance costs increase, so do home insurance premiums.

Over the past year there have been three Florida-based home insurance carriers who were acquired by other companies due to financial hardship. Unfortunately, this is not an uncommon situation in Florida and it is likely that more companies will close their doors. With fewer insurers available, the surplus of risks taken on by the remaining insurance companies leads to increased costs for reinsurance and hikes in premiums.

Natural Disasters

After several years without major hurricanes directly hitting the peninsula, Florida residents were reminded that the risk is still very real in 2017, beginning with Hurricane Irma. Making landfall in Southern Florida, Irma caused over $50 billion in damage and resulted in nearly one million insurance claims. The following year Hurricane Michael devastated the panhandle and created nearly 150,000 additional home insurance claims. Both of these storms have had an effect on the financial state of insurance companies and the cost of reinsurance.

What Can You do?

When we see premiums increase we proactively quote your home insurance with our other top-rated carriers to find you a better rate. If possible, we will get you started on a new, better-valued policy at your renewal.

Look for Discounts

Have you recently added a new roof to your home? Storm shutters? Maybe you have a new security system? You may be eligible for a discount on your homeowners policy! When you make any changes to your home, always let your insurance agent know so you don’t miss out on potential savings.

Review your Policy

Our retention and renewal team reviews each policy renewal once it becomes available. At this time our insurance experts look for any potential changes to your policy, such as discounts lost or coverage increases. However, there could be some coverages you opted for when you first purchased your policy that you might need to change, which could lower your premium.

For example, most insurers will increase your dwelling coverage each year if you selected the inflation guard option. If you have been with the same company for years, this amount could become higher than what it would truly cost to rebuild your home.

Contact your Agent

If you have any questions about your policy cost or coverage contact your Viera Insurance agent. As your neighbor in the neighborhood, we are always here to answer any questions you might have. Our goal is always to make sure you have the best coverage at the best value.