Florida home and condo owners pay some of the highest insurance premiums in the nation.
And with the number of storms that have devastated parts of the state, it may not be a shock that property insurance is especially crucial for Floridians.
Insurance was also a big topic this past legislative session, with House Speaker Daniel Perez saying that "property insurance matters to the people of Florida."
More than 250 bills passed out of the House and Senate — two had some minor connections to home insurance.
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As the chair of a new Florida insurance company, former state Sen. Jeff Brandes of Pinellas County brings experience from both sectors. On Friday, he told "The Florida Roundup" there are still minor fixes in the industry that are necessary.
Brandes added that he thought the House wanted to go backward. He mentioned legislators talking about reinstating some policies the Legislature worked on in 2022 and 2023. One was ending the "One Way" attorney statute.
He said the other 49 states follow what's called "the American rule," where customers pay their insurance and litigation fees. Florida is an outlier to where it had 8% of U.S. property claims but accounted for 80% of the litigation, Brandes added.
We're really excited about the opportunities in the Florida marketplace, and there's plenty of room for growth and competition. And that's frankly what's going to drive down pricing in Florida.Jeff Brandes
"You can't be the most hurricane-prone state and the most litigious state and expect low property insurance rates," Brandes said. "The math just doesn't work."
He added that this litigation has been "by far" the No. 1 contributor to premiums increasing.
"You can model hurricanes. You can't model litigation," Brandes said. "Florida was just overwhelmed with litigation. Nobody could tell you what the hurricane was going to cost, not because of the storm damage. They understood roughly what the storm damage was going to be. It was what would the litigation post-storm damage be."
Brandes said the Tampa and Miami regions are two of the most challenging property insurance markets in Florida.
Why the state insurance market could be improving
Program host Tom Hudson described how the rate of increases has slowed in Florida, but is still high compared to premiums in other states.
Brandes agreed and said he believes the market is getting better.
The reason? The number of companies, he said.
According to Brandes, 13 companies have formed in the state since 2022, including the one he chairs, Patriot Select Property and Casualty Insurance. He added that this influx is something that he hasn't seen in years.
Brandes said Patriot Select is focusing on the standard homeowners policy, HO-3, to begin with. There's a hope to grow into other products over time.
He added that the company is looking to insure single-family homes between $250,000 to $2.5 million. There are also certain roof age range requirements in the policies, but Brandes did not allude to what those were.
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"We're really excited about the opportunities in the Florida marketplace, and there's plenty of room for growth and competition," Brandes said. "And that's frankly what's going to drive down pricing in Florida."
The former senator also mentioned that Citizens Property Insurance, the state's insurer of last resort, has fewer policies than it did a few years ago. The nonprofit is designed to provide property insurance to eligible property owners unable to find insurance coverage in the private market.
Brandes said Citizens had 1.4 million policies in 2022, adding that it had $500 billion worth of risk on the books. He mentioned that this has now come down to a level they expect. By the end of this year, it could be down as low as $650,000 in policies.
"And I think could actually be lower than that, which is incredibly positive," Brandes said.
"We're really excited about the opportunities in the Florida marketplace, and there's plenty of room for growth and competition," Brandes said. "And that's frankly what's going to drive down pricing in Florida."
When it comes to the type of insurance, Brandes recommends having an "admitted carrier," meaning state-licensed. This compares to an Excess and Surplus carrier (E&S), which is not required to comply with the state's insurance laws and regulations.
Why a state-licensed carrier could be beneficial
Brandes said the reason he recommends having a state-certified carrier is due to the benefits. One of those includes having Florida Insurance Guarantee Association (FIGA) protection.
"If an E&S carrier fails to pay your claim and goes bankrupt, then there is essentially no protection out there for you," Brandes said.
He added that FIGA will pay a portion of a claim if your insurance company goes bankrupt.
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"I think the state deserves a carrier that is focused on the state of Florida, with executives that have deep experience in the state of Florida," Brandes said.
He said more carriers are better.
And overall, the former senator is of the belief that if there are no major storms this year in Florida, the rates and potentially the premiums could go down.
"The market is improving. Things are getting better in Florida, and let's hope we have no storms this year," Brandes said.
However, there's a caveat. The challenge could come from the increase in home prices and the cost to replace and repair homes, he said. So even if the rates drop, the premiums could go up because of the replacement costs and home values.
"We don't know what's going to happen with tariffs. We don't know what the impacts of (immigration) raids on labor are going to be in Florida. Your insurance company doesn't know that," Brandes said. "It's a unique product in the marketplace where we don't know what our cost of goods sold are."
This story was compiled from interviews conducted by Tom Hudson for "The Florida Roundup."
