Florida Homeowners’ Insurance 2025
March 5, 2025
As Florida homeowners continue to face challenges with property insurance, Governor Ron DeSantis said last month that Florida’s Citizens Property Insurance Corporation will reduce homeowner insurance rates by an average of 5.6% in 2025. In addition, the governor stated the Sunshine State's provider had the lowest average increase in homeowners insurance rates nationwide over the past year.
Citizens Property Insurance Corporation is a not-for-profit company created in 2002 by the state legislature as an insurer of last resort to provide property insurance to Florida residents who can’t get coverage or reinsurance from private insurers. The tax-exempt governmental entity shared information last week that it had reduced current policies in force to below 850,000 dropping its number of customers to the lowest total in nearly three years.
This ray of sunlight coincided with eight private insurers being approved last month to assume Citizens homeowners’ policies under what is legally known as the state’s “Depopulation Program.” To reduce the risk of assessments for all Floridians, Citizens is required to help return homeowners’ insurance policies to the private insurance sector when approved by the Office of Insurance Regulation. The state’s Depopulation Unit works with insurers to facilitate the transfer of policies under assumption agreements during a Depopulation Cycle.
Grappling with an insurance crisis...
Most experts agree that a homeowners’ insurance crisis had been covertly building for years before Hurricane Ian caused billions of dollars in damages to Florida property in 2022. Although it is easy to point-the-finger at climate change, it appears that it is not just the state’s storm activity that has exacerbated the cost of this form of property & casualty insurance statewide. Nonetheless, grappling with an insurance crisis is nothing new and it is each state’s responsibility.
Rather than being a federal task, our government simply sets minimum standards that state laws must meet. The McCarran-Ferguson Act of 1945 established this system of regulation, where taxation and regulation of the insurance industry by the state was determined as being in the public’s interest. With preeminence over federal law, each state has statutes and Florida’s Office of Insurance Regulation is the regulator for insurance rates, policy forms and market conduct.
Florida Insurance Commissioner, Michael Yaworsky (nonpartisan), was appointed by Governor Ron DeSantis as the Financial Services Commissioner in March of 2023. The office of the commissioner of insurance regulation is responsible for all activities concerning insurers and other risk bearing entities. This includes licensing, rates, claims, issuance of certificates, solvency, viatical settlements, premium financing, and administrative supervision.
What Does a Home Insurance Policy Cover?
Homeowners' insurance is a type of property and casualty (P&C insurance) designed to protect your home and personal property against damage, loss, or theft. This coverage typically includes protection against risks such as fire, storms, and other perils. While homeowners' insurance primarily applies to houses, it can also cover related residential structures, renters, and condominium unit owners. Policies can also provide liability coverage for accidental injury or death where the homeowner is legally responsible.
Most mortgage lenders require homeowners' insurance as a condition of the loan. A standard policy generally includes six key components of coverage:
Coverage A (Structure) – For the dwelling itself, standard homeowners’ insurance policies typically cover events like hurricanes, fires, storms, and theft. However, there are notable exclusions. Damage caused by floods, earthquakes, landslides, or sinkholes, as well as water backup from sewers, drains, septic tanks, or sump pumps, is not included.
Coverage B (Other Structures) – Florida home insurance covers detached structures on the homeowners’ property, such as sheds, fences, and garages. Although each policy and carrier may have different limits on their coverages, it is often calculated at 10% of the main structure’s insured value for covered perils, such as windstorms or falling trees.
Coverage C (Personal Property) – This personal property coverage includes contents of the structure, which protects belongings from damage or loss, such as furniture, clothing, electronics, and other personal items. Coverage from disasters, fire and theft depends upon the value of the belongings. Additional coverage is needed for high-value items like jewelry or art.
Coverage D (Loss of Use) – Coverage D, which is also known as Additional Living Expenses coverage, helps pay for living costs if the home is uninhabitable. This can include hotel stays, rental homes, meals, transportation, clothing, laundry, pet boarding, and storage. It doesn’t cover costs the owner was responsible for already or elective renovations.
Coverage L (Personal Liability) – This type of personal liability insurance designed to protect homeowners from lawsuits filed by guests or tenants on their property. It can cover medical bills for injuries, legal fees for lawsuits, and damage to tenant’s belongings. Coverage L includes homes with attractive nuisances like a pool or trampoline as well as pets.
Coverage M (Medical Payments) – Medical payments “to others” coverage, or MedPay, is a type of homeowners insurance that pays medical expenses for injuries sustained by guest on your property. It is designed to prevent lawsuits by handling smaller claims that can include ambulance rides, hospital stays, X-rays, surgery, nursing care, deductibles, and funeral costs.
Florida homeowners insurance provides coverage for damages to your home and personal belongings, as well as liability protection for injuries or fatalities when there is legal responsibilities. However, to ensure full protection, homeowners should review their policies carefully. Although flooding is a common risk due to Florida’s proximity to water and history of yearly storms, flood damage is not typically covered by homeowners’ insurance. The National Flood Insurance Program offers flood insurance to property owners, renters, and businesses.
Premium Discounts for Hurricane Loss Mitigation
According to the Florida Office of Insurance Regulation, homeowners may be eligible for insurance discounts when they take steps to protect their homes against hurricane damage. State law requires insurance companies to offer mitigation discounts for homes with hurricane-resistant features, such as reinforced enclosures. Policyholders are provided with a Wind Mitigation Notice of Premium Discount Form when a new policy is issued and at every renewal.
This document outlines deductible options and gives examples of potential premium savings for homes with wind-mitigating improvements. To qualify for these discounts, homeowners need a certified inspector to document their wind mitigation features using the Uniform Mitigation Verification Inspection Form. Keep in mind that most property insurance policies cover wind damage under “windstorm” coverage but may exclude wind coverage in high-risk coastal areas.
Qualified inspectors include licensed general, building, or residential contractors, licensed professional engineers, a licensed professional architect, or a certified building code inspector. Additionally, standard Florida homeowners' insurance policies do not cover flooding, including storm surge. To learn more about these discounts, refer to the Department of Financial Services' Premium Discounts for Hurricane Loss Mitigation Consumer Guide.
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The American Property Casualty Insurance Association also noted that Florida’s insurance market has begun to stabilize with new private insurers entering the state. Insurers, including Citizens Property Insurance must act in good faith when handling claims. As a Florida homeowner, you also have rights and options should you believe your insurance company has wrongfully denied or underpaid your claim. So, you can sue your homeowners' insurance company in Florida if they fail to honor the terms of your policy.
