Florida’s Insurance Crisis of 2021: Risks and Opportunities
Florida is experiencing its most severe Property Insurance crisis in the past 30 years.
This is not just a crisis of exploding premiums. It is a crisis of INSURANCE AVAILABILITY.
Rampant and systemic insurance claim fraud and abuse coupled with increased hurricanes have crippled the available insurance market. Today the problems are primarily with Homeowners insurance, but the crisis is expanding to the Commercial Property market. Homebuyers and sellers, realtors, investors, property managers, attorneys, inspectors, insurance agents, and lenders are impacted and at risk daily. Anyone involved in the real estate business must adjust for the current insurance crisis or face an increased RISK of financial loss or legal liability.
Imagine you have a contract to buy or sell real estate. The contract has an inspection period and a $100,000 deposit that is refundable until the end of the inspection period. The inspection period comes and goes without the buyer completing critical insurance inspections or having the inspections reviewed by a well-versed insurance expert. The contract goes hard, and the deposit becomes AT RISK. The buyer then learns insurance will cost twice the expected amount or worse, the property is uninsurable. All persons involved face financial risk. Who is at fault? Answer: Everybody in the process may have some responsibility for the train wreck.
This insurance crisis started early in 2020. It has grown more critical every month. It will continue through at least 2021.
Very few businesses have taken the needed steps to protect themselves and serve their clients.
You cannot change this insurance crisis. You can take steps to protect yourself and your business. With crisis comes opportunity. The same steps that protect your business also can serve your clients. Use these troubled times to build a competitive advantage, improve client service and enhance your professional reputation.
Contact us or your insurance advisor to discuss.