Florida Homeowners Face Serious Challenges as Insurance Claims Top $2.5 billion

Owning property in Florida brings with it some unique risks.

Hurricanes, tropical storms, significant lightning, hail, and wind events present serious challenges to insuring the value of your property against loss and damage.

The latest figures from TrustedChoice.com show that Florida homeowners incurred more than $2.5 billion in losses in the most recent reporting period.

When all insured property losses are included, that figure rises to over $22 billion.

What Are the Top 5 Florida Home Insurance Claims?

Wind and Hail Damage

It’s no secret in Florida that wind and hail can cause significant damage to property. Structures and vehicles exposed to the elements are particularly susceptible to impact damage from hail and other flying objects propelled by high wind events.

In fact, the high incident rate for tropical storms and hurricanes puts Florida at the top of the list of at-risk properties for wind and storm damage. According to the Insurance Journal, 98% of Florida’s population resides in coastal areas susceptible to damage from storms and 79% of insured property is located in these high-risk areas.

Water Damage and Freezing

Freezing in Florida may seem counterintuitive, but Florida property owners suffer significant annual losses due to damage from water and freezing temperatures. Homes in Florida are built to accommodate the hot, humid climate that prevails much of the year and not the freezing temperatures found in other regions.

While the incidence of freezing temperatures varies around the state, plunging temperatures do result in severe property damage and financial loss each year. Many homeowners have had the unpleasant experience of waking to a flooded house from pipes that burst overnight in a Florida freeze.

Property Damage

The broad category of property damage includes a variety of event types that result in significant losses to property owners. Fallen trees landing on the family car, personal possessions ruined by rising water and storm surges, fires started by downed power lines, sinkholes, and other occurrences result in insurance claims by individuals and businesses each year.

The most recent available Insurance Information Institute figures put property damage loss in Florida at over $22 billion. The type and nature of the property damage may vary from region to region within the state, but the numbers represent a real impact on lives and businesses.

Theft

Theft and other criminal activity also result in notable losses for Floridians. For example, Florida ranks third nationally in the number of auto thefts.

Figures for 2016 from the Florida Department of Law Enforcement put the total number of property crimes at 279,360. These include robberies, burglaries, larceny and motor vehicle theft with a staggering aggregated property value of $644,412,403.

Fire and Lightning Damage

Most Floridians know that the Tampa Bay Area is considered to be the lightning capital of the world. Lightning, however, does not discriminate and is not limited by boundaries on maps. The climate throughout Florida makes lightning strikes, and fires started by lightning, a frequent occurrence.

Not surprisingly, Florida leads the nation in insurance claims resulting from lightning events. Loss figures for 2016 show that insurance companies processed and paid 10,385 lightning-related claims totaling $67.8 million.

Real Lives are Affected

Insurance companies paid $33,014,264,000 for Florida property damage claims in the most recent reporting period.  That’s just the starting point.

Data shows that annually 5.3 percent of insured homes report an insurance claim, with property damage accounting for 97.3 percent of claims. These losses affect real lives, family, friends, neighbors, at some point, perhaps you.

In addition to the cost of repairs and rebuilding, mortgages, utility bills, taxes, and living expenses must still be paid. The homeowner is often immersed in the details of recovering lost assets. Some may even experience loss of wages and employment as a result, increasing stress and financial uncertainty.

The Challenge

On average, 374,000 residences catch fire each year in the United States. That’s a loss of $7.32 billion to homeowners.

A home is a family’s largest financial investment, but they are subject to natural disasters, burglary, theft, the carelessness of others and the liability of its occupants. The challenge is to protect this vulnerable investment adequately from catastrophic loss.