“If a hurricane strikes a major metro area as opposed to a rural area…it would have a greater impact on losses and properties that are impacted, certainly,” said Mark Friedlander“Florida’s property insurance market remains very volatile, but the insurance industry is well-capitalized to pay Idalia claims,” he added. “One of the biggest reasons is insurers have been able to obtain adequate reinsurance policies this year.
The cost to the consumer, however, will likely be higher insurance premiums. One of the biggest reasons insurance companies are in a good financial position to pay claims this year, according to the Insurance Information Institute, is because insurers have been able to obtain satisfactory policies from reinsurance companies, which insurance firms use to cover some of their risks.. “The average cost of reinsurance increased 40-70% this hurricane season.
Florida residents are already spending an average of $6,000 dollars on home insurance policies, according to III, four times more than the average in other states. While those potential increases won’t impact most homeowners this hurricane season, the trickle-down effect will become more evident as policy renewals roll around. Homeowners will also not be affected by some of the recent insurance company withdrawals from Florida.