Florida Gov. Ron DeSantis has managed to make his entire term about the conservative culture wars. He ignored COVID-19 protections, mocked children who wore masks, imposed severe restrictions on what teachers could say, spent millions on a fake election fraud task force, picked a fight with Disney over LGBTQ rights, and very recently, spent millions in taxpayer money for a cruel Texas border stunt that abducted asylum-seeking families. More recently, he sent local police to arrest Black voters on fraud charges who were (surprise, surprise) innocent. Meanwhile, as DeSantis played up to his far-right base, Florida’s real issues went disregarded.
Even before Hurricane Ian, our state’s home insurance market had been rapidly collapsing. It’s not uncommon for homeowners like myself to get a letter saying the insurance we have is going away because either the company is no longer insuring homes in Florida, or is shutting down altogether. While the rest of my family members in other states are able to use a major insurance carrier they’ve had for decades, carriers told me they simply don’t do Florida. Other carriers, like Southern Fidelity, Progressive, or Universal are no longer renewing policies.
Yet as bad as it has been, the recent Category 4 storm that hit Florida has made things much worse. The storm created almost as much destruction with our state’s insurance market as it did with actual property. Since 2017, six insurers have liquidated, but there are many more expected to fail after Hurricane Ian. The last remaining carriers are either no longer writing new plans in Florida or requesting rate increases—even though Floridians already pay three times the national average.
Back in June of this year, Florida Republican legislators met in a special legislative session where they promised to do something about the unbearable insurance burden on our state’s citizens. The average cost for property insurance here in the Sunshine State is $4,231 annually, which has more than doubled since DeSantis took office. There was big talk of a much-needed overhaul of our property insurance market, of putting rate caps in place, a possible rate freeze, and finally, reforming the state’s Florida Hurricane Catastrophe Fund. DeSantis and his allies did exactly none of these things.
Another big issue this session ignored concerned flood insurance. The high cost means that most Floridians don’t carry it, and legislators not only did nothing to help in this area, but refused to change the current law that allows sellers to not disclose a property’s flood risks or past flood damage to a potential buyer.
Finally, there was little done to help with the issue of Florida’s lax “tort” laws, which are legal claims where an injured party seeks compensation for damages, which has caused Florida to become the top state for insurance lawsuits. The Floridian insurance market accounts for 79% of America’s homeowners’ insurance litigation, but only 9% of claims. One big reason for this is due to legal special interest groups that encourage legislators to allow large attorney fees for types of lawsuits.
My neighborhood under water from Hurricane Ian
“Assignment of benefits” is extremely common with property insurance lawsuits in Florida. Essentially, the attorney or contractor has the homeowner sign over their property insurance policy to them, so any money collected goes directly to them—not the homeowner. Lawyers then sue the insurance companies for far more than the initial repair costs.
Assignment of benefits is legal, thanks to a concept known as freedom of contract, which says two parties may make a private agreement, including the forfeiture of certain rights, and the government may not interfere. Yet since 2013, only 10% of the $15 billion in insurance company payouts went to policyholders. The rest went to the attorneys or contractors.
The legislative solution from this special session came down to Senate Bill 2-D. Rather than go after those who abuse our system or protect the homeowners, the bill protected the insurance companies. The solution to combat the high rate of insurance fraud in Florida was to make it so that Floridians can no longer hire claims adjusters or other forms of legal help to sue insurers over wrongfully decided rejections of claims.
The bill does absolutely nothing to lower home insurance rates. Florida GOP legislators managed to make things worse while not delivering on anything that Floridians actually need. Some lawmakers said this would help lower costs, although it should be noted that after the bill went into effect, the Florida Office of Insurance Regulation approved an average rate increase of 6.4% for homeowners.
Then, on Sept. 28 of this year, Hurricane Ian hit Florida—hard. It was one of the fiercest storms in U.S. history, with over 100 deaths and over $67 billion in damage. DeSantis, who voted against aid to hurricane victims as a congressman, was taken aback by the destruction and was forced to ask for help from the Biden administration.
Since nothing really was done to address the property insurance crisis, and DeSantis was 100% focused on his own political ambitions involving stunts—like kidnapping migrants and arresting voters—insurance premiums have skyrocketed in Florida. In August, DeSantis bragged about shoring up the insurance market here with what amounted to be a $2 billion taxpayer bailout for insurance companies while once again not giving any relief to Florida homeowners.
In fact, homeowners this year face a 2% tax on property insurance through the end of next year. Coincidentally, insurance companies have been major donors to DeSantis’ political campaign. They have invested $3 million currently, which is a small price to pay considering they have received billions in return.
DeSantis’ opponent for this year’s gubernatorial race, former Gov. Charlie Crist, told reporters, "You pay and pay and pay, and the insurance company isn't there for you in the end anyway."
The biggest insurers in the nation may have no problem giving large amounts of money to DeSantis, but they are leaving Florida in droves. The free market doesn’t make it feasible to insure homeowners in Florida because of the massive risks. This means smaller in-state carriers have to pick up the slack. Floridians have much smaller insurers than other states with names you’ve never heard of. I was fortunate this year in that my house barely survived the storm, but none of my neighbors were so lucky. They are terrified because they know the insurers they have been forced to use don’t have a lot of capital.
To be clear, we live inland near Orlando. However, understand that we subsidize those who choose to live on the coast. Under Jeb Bush, the legislature created the Florida Citizens Property Insurance Corporation, which provides low-cost property and hurricane insurance to anyone who can’t find an insurance company. It has over a million users, and this hurricane is expected to double that number.
Houses put out water-logged furniture and flooring after the flood. After the water recedes, a new nightmare begins where people try to rebuild.
The reason it is cheap is because if the company doesn’t have enough to pay the claims, all Floridians are levied a surcharge on our policies to help pay for their losses. Even if I don’t live in a danger zone or have any damage, I am forced to pay. Granted, there are people on it who need it who can’t get any other insurance, but there are many who use it because they have expensive homes and condominiums on the beach where the risk is too high for the private market.
In a way, it’s socialism—but only for the wealthy. This is acceptable in Republican parlance, yet it’s also unsustainable. If another hurricane hits this year, our real estate market, and possibly our economy, will completely collapse. We don’t have the budget for another disaster, and a similar hit would push up the cost of insurance until it's out of reach for all but the most wealthy people. Unfortunately, with climate change getting worse, it is more than likely we will have bigger, more destructive, and more frequent hurricanes.
There’s a much better way to do this, and DeSantis could take a lesson or two from his bitter rival, California Gov. Gavin Newsom. California has a much better, proactive approach.
When it comes to home insurance, California is the anti-Florida. Newsom has invested in the California Earthquake Authority (CEA), a non-governmental organization that sells earthquake insurance through 25 participating insurers. The CEA provides homeowner, condominium, mobile home, and renter insurance with earthquake coverage, but spreads the risk amongst their large pool of insurers. This makes affordable earthquake insurance possible. Participating insurance companies take a small portion of the risk in the state, but no one carrier fails if there is a massive earthquake. And since CEA is not a direct insurer, they never levy taxes on their citizens to cover costs. Florida should follow this model.
Louisiana also has a state-run “citizens'' insurance model like Florida. Unlike Florida, however, lawmakers passed laws to encourage capacity, strengthened solvency requirements, developed contingency plans, and required a streamlined claims process. Florida lawmakers have done nothing, and continue to do nothing.
To be fair, it’s hard to get GOP legislators to do anything about an issue they don’t believe is real. Climate and planning experts warn that rebuilding along the crowded coast, following a decade of weakened rules governing development, is only helping to create new and larger disasters. Republicans under Florida Senator Rick Scott abolished the state agency a decade ago that was mandated to manage risky developments as climate change occurred more rapidly. Scott responded by banning anyone in his administration from even saying the words “climate change.” He instead called for abolishing all the state’s growth management rules, which we did.
There are plenty of reasons to fight against Republicans, and especially the reelection of DeSantis. The fact that he has turned himself into a mini-dictator by crushing the will of the legislative branch and stacking the judiciary with his partisan friends should be reason enough. If he wins this year, he will become even worse. However, the fact is that Floridians seem to get more riled up over issues like insurance reform than they do over losing democracy.
Crist has a seven-point plan on his website to fix our property insurance crisis. These include measures like requiring large insurers that sell highly profitable auto insurance to Floridians to also offer homeowners insurance and establishing a National Catastrophic Insurance Plan. It also calls to create a task force to actually deal with insurance fraud, instead of wasting law enforcement resources going after women trying to have an abortion or innocent people trying to vote.
DeSantis, unsurprisingly, has no plan. His website makes no mention of home insurance. In fact, there is almost no policy at all mentioned except for culture war topics like “rejecting critical race theory,” “creating an Election Crimes Office,” and a section calling the press “hysterical” and “smear merchants.”
Florida needs and deserves so much better.
