50% rate hike? Customers of these Florida insurance companies could face higher premiums
TAMPA, Fla. (WFLA) — Two Florida insurance companies are looking to raise their rates by more than 50%.
Castle Key Indemnity Company, which is owned by Allstate, covers condo owners. The company has proposed its rate to jump by 53.5% for customers.
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Amica Mutual Insurance, which covers properties like vacation homes, has proposed a 54.1% increase.
“More frequent, severe weather, higher repair costs and elevated reinsurance premiums have caused rates to rise in many states, including Florida,” a spokesperson for Allstate said in a statement.
Allstate said the rate increase for Castle Key was filed with the Florida Office of Insurance Regulation nearly a year ago and began rolling out to customers in May 2023. The company said this is not a new proposal to increase condo rates.
In a statement regarding the Castle Key increase, a spokesperson said: “The cost of providing reliable protection for Florida properties has risen dramatically, and we’re taking actions to ensure we can protect customers over the long haul.”
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Mark Friedlander, who is the Florida spokesperson for the Insurance Information Institute, said Castle Key only writes policies for about 150,000 Florida homeowners.
Friedlander said some of the cost increase is because of the tragedy that occurred in Surfside with a collapse of a condo there. However, he said the insurance situation is improving in Florida.
“In fact, seven new companies have been approved to write new business in 2024 and that’s an amazing result of the legislature because for many years, companies were pulling back on Florida,” he said.
“You could actually now begin to shop your coverage and get competitive quotes,” he said. “So, if you’ve seen a significant increase, no matter what type of property insurance you have, it might be time to call your agent.”
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Former State Sen. Jeff Brandes said three main factors are driving up the cost of homeowners insurance in Florida.
“Litigation was driving, was truly driving up the cost,” Brandes said. “The challenge we have now is, inflation is here and inflation wasn’t a big deal two or three years ago. It’s definitely a major issue today and the reinsurance prices have continued to be higher throughout the country.
Brandes said the legislature needs to do more work to improve the homeowner insurance situation in Florida.
“I think there are solutions out there,” he said. “I think the legislature needs to come up with a long term strategy for how to deal with property insurance in the state. To date, they haven’t done that.”
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