After years of not being profitable, Florida’s insurance industry is having a good year so far.
“According to the Florida Office of Insurance Regulation, insurers are showing much more positive results this year than in the past,” said Mark Friedlander of the Insurance Information Institute.
The better bottom line may be due to the fact that the hurricane season so far has only seen Hurricane Idalia in North Florida, which didn’t come close to the damage caused by Ian in Southwest Florida a year ago.
The year is also looking good for reinsurers such as Berkshire Hathaway, which has a reported $15 billion of exposure in Florida this year.
Back in May, the company’s vice chairman of insurance admitted that it would face big losses if a major hurricane hit Florida.
But all that profitability may not necessarily mean better days ahead for policyholders.
“Insurers have to price for expected risk, and they don’t price for just one season,” Friedlander said.
Predicting a damaging hurricane season is not a perfect science, and Florida’s weather history continues to play an important role in setting rates.
As a result, industry experts are still watching to see if legislative reforms in Florida will reduce fraudulent lawsuits for insurers.
“I don’t think premiums are going to come down anytime soon,” said Richard Estrella of Estrella Insurance, a multi-state agency based in Florida. “But maybe we will reach a level that we have reached, and maybe we can all start finding ways to bring premiums back down and become competitive again.”
