Hurricane Ian swamped a Florida hospital from both above and below, the storm surge flooding its lower level emergency room while fierce winds tore part of its fourth floor roof from its intensive care unit, according to a doctor who works there.
Dr. Birgit Bodine spent the night at HCA Florida Fawcett Hospital in Port Charlotte, anticipating the storm would make things busy, “but we didn’t anticipate that the roof would blow off on the fourth floor,” she said.
Water gushed down Wednesday from above onto the ICU, forcing staff to evacuate the hospital’s sickest patients — some of them on ventilators — to other floors. Staff members resorted to towels and plastic bins to try to mop up the sodden mess.
The medium-sized hospital spans four floors, but patients were forced into just two because of the damage.
Bodine plans to spend another night at the hospital, when incoming storm injuries could make things worse.
“The ambulances may be coming soon and we don’t know where to put them in the hospital at this point,” she said. “Because we’re doubled and tripled up.”
Despite the inundation, Bodine said patients have been mostly understanding and upbeat.
“For us, as much as everything is terrible and we’re exhausted … as long as our patients do OK and nobody ends up dying or having a bad outcome, that’s what matters,” Bodine said.
Photo: Dr. Birgit Bodine at HCA Florida Fawcett Hospital in Port Charlotte, Florida, on Wednesday. (Dr. Birgit Bodine via AP)
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Wind and storm-surge losses from Hurricane Ian could reach as $47 billion in Florida alone, a figure made larger by inflation and rising interest rates, the property analytics firm CoreLogic said in a new analysis.
“This is the costliest Florida storm since Hurricane Andrew made landfall in 1992 and a record number of homes and properties were lost due to Hurricane Ian’s intense and destructive characteristics,” said Tom Larsen, associate vice president for hazard and risk management at CoreLogic.
Wind-damage losses in Florida, where Ian made landfall Wednesday afternoon near Fort Myers, are expected to be between $22 billion to $32 billion for residential and commercial properties. Storm-surge damage could add another $6-$15 billion, CoreLogic calculated. The analysis was based on high-resolution imaging and storm-surge computer modeling, the firm said.
CoreLogic said its calculations include insured and uninsured losses, and Hurricane Ian has yet to make another predicted landfall in South Carolina as a Category 1 storm on Sept. 30, but to begin to put Hurricane Ian into a historical perspective, below is a list of the costliest U.S. hurricanes to the insurance industry.
With inflation at a 40-year high, interest rates near 7%, and labor and building materials in short supply, recovery will be slow and difficult.
“Hurricane Ian will forever change the real estate industry and city infrastructure,” Larsen said in a news release. “Insurers will go into bankruptcy, homeowners will be forced into delinquency and insurance will become less accessible in regions like Florida.”
Besides winds and surge on Florida’s southwest coast, Ian also caused widespread flooding inland in Florida. The storm by Friday morning had weakened, then strengthened as it aimed for coastal South Carolina with 85-mph winds, the National Weather Service reported.
Larsen said the storm will likely be a wake-up call, spurring stronger building codes and more resilient infrastructure.
ICEYE, the satellite imagery firm, reported that almost 84,000 properties in coastal southwest Florida were affected by storm surge and flooding during Ian, as of Thursday afternoon. Most of those felt less than two feet of water, but 284 were hit by floodwaters above eight feet, the company reported.
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Naples during Ian storm surge (ICEYE)
Map based on satellite images before Ian hit Naples. (ICEYE)
Naples during Ian storm surge (ICEYE)
Map based on satellite images before Ian hit Naples. (ICEYE)
Hurricane Ian continued to churn through central Florida Thursday morning, leaving widespread flooding and wind damage in its wake. It was too early to know the extent of property insurance claims from the storm, although a few analysts and officials offered some preliminary estimates.
Some in the industry are now worried that extensive losses from the storm, which made landfall north of Fort Myers with an estimated 12-foot storm surge, could be devastating for Florida’s largest and fastest-growing property insurer – the state-created Citizens Property Insurance Corp.
Citizens’ CEO Barry Gilway said Wednesday that preliminary estimates have put claims at about 225,000 and potential exposure at about $3.8 billion, a spokesman for the insurer said. That’s likely not enough to force an assessment on policyholders, he said, in response to a reporter’s question.
A former deputy Florida insurance commissioner, Lisa Miller, warned that if losses exceed the corporation’s reinsurance coverage, Citizen policyholders could see a 15% surcharge for all three of Citizens’ accounts – as much as 45% per property.
If Gilway’s estimate holds true, it would mean Citizens avoided a worst-case scenario with the powerful storm. The Office of Insurance Regulation’s quarterly reports, based on insurer data, shows that for the five coastal counties most affected by Ian, Citizens holds more than 60,000 policies with a total exposure of at least $17.5 billion.
The OIR’s Quarterly and Supplemental Report, known as QUASR, shows that another insurer, the Palm Beach Gardens-based Olympus Insurance Co., has significant exposure. For the hard-hit coastal counties of Manatee, Sarasota, Desoto, Charlotte and Lee, Olympus had some 13,800 policies in the second quarter of this year, with $11.3 billion in exposure.
The report does not give a complete picture of the market. A number of Florida-based insurers do not report their data or allow them to be made public, calling the information “trade secrets.” But the Olympus numbers are notable. Statewide, the firm had some 79,000 policies and $233 million in total written premium.
Olympus CEO Steve Bitar could not be reached for comment about the Ian exposure.
Other insurers with billions in exposure in the five coastal counties include:
Three USAA companies, with $6.8 billion in total exposure, including wind coverage
Cypress Property & Casualty Insurance Co., with $4.4 billion
Castle Key Indemnity Co., part of Allstate Insurance, with $4.3 billion
TypTap Insurance, with $3.7 billion.
Insurance industry insiders said it’s difficult to judge which carriers are most vulnerable without knowing the extent of their reinsurance programs, information that is not usually made public.
Statewide, claims from Hurricane Ian could total as much as $30 billion, a Wells Fargo analyst told Barron’s financial news site. Another analyst told Barron’s that the storm could also lead to higher reinsurance premiums, a tough call for some insurers already struggling with reinsurance costs that spiked as much as 50% this year.
Meanwhile, the Florida OIR said that insurers should begin daily reporting of catastrophe claims as early as Friday, Sept. 30, through Friday, Oct. 7. The data should be reported each day before noon Eastern time, through the simplified 2022 catatastrophe reporting form, or CRF, OIR said in a bulletin Wednesday.
Insurance Commissioner David Altmaier also issued an emergency order that requires insurance companies to extend deadlines for insureds. For any policy or other notice that requires policyholders to provide information by Sept. 28, the time has been extended to Nov. 28.
Insurers also are barred from cancelling or non-renewing policies until after Nov. 28, the order reads. All notices that were mailed after Sep. 18 must be withdrawn and reissued to insureds after the November date. In addition, insurers should not cancel residential policies on damaged homes in Florida until 90 days after the dwelling has been repaired.
Rate and form filings known as “use and file,” which are not reviewed by OIR until later, are suspended for now.
Hurricane victims that utilize premium financing and have lost their homes or jobs should contact the OIR.
“Victims of Hurricane Ian will receive an automatic extension of time to and including November 28, 2022, to bring their accounts up to date,” the order noted. “No late charges will be applied to any late payments received which were due on their accounts between September 28, 2022 and November 28, 2022.”
The OIR also said it expects claims to be paid in a timely manner.
“Given the strength and size of Hurricane Ian, its expected catastrophic effect on Florida, and its potential impact on hundreds of thousands of policyholders, the Office expects all insurers and regulated entities to implement processes and procedures to facilitate the efficient payment of claims,” the order reads. “This includes critically analyzing current procedures and streamlining claim payment processes as well as using the latest technological advances to provide prompt and efficient claims service to policyholders.”
Photo: Zuram Rodriguez surveys the damage around her mobile home in Davie, Fla., early Wednesday. Hurricane Ian rapidly intensified off Florida’s southwest coast Wednesday, gaining top winds of 155 mph, just shy of the most dangerous Category 5 status. (Joe Cavaretta/South Florida Sun-Sentinel via AP)
Hurricane Ian, projected to be one of the costliest storms in US history, prompted mass evacuations, school shutdowns and thousands of flight cancellations across the third-largest state.
The storm, which has already caused a nationwide power outage in Cuba, has top winds near 120 mph as it swirls over the southeastern Gulf of Mexico, about 95 miles (153 kilometers) from Naples, Florida, according to an advisory from the US National Hurricane Center at 2 a.m. New York time. The storm is forecast to strengthen through Wednesday, threatening to bring 6-foot storm surges into Tampa Bay and heavy rains across the US Southeast.
Local media broadcast video of interstate highways jammed with cars and trucks attempting to flee vulnerable cities and towns along Florida’s western coast. Damages and economic losses in the area could exceed $45 billion if the current forecast comes to pass, said Chuck Watson, a disaster modeler with Enki Research. That would rank Ian as the eighth-costliest US hurricane, according to data from the National Oceanic and Atmospheric Administration. Earlier estimates were higher when it appeared Ian was going to make a direct hit on Tampa.
The storm comes as climate change fuels extreme weather worldwide, including hurricanes that rapidly gain strength as they approach land. The year has already brought deadly flooding in Kentucky, a heat wave that killed more than 2,000 people in Portugal and Spain, a relentless drought gripping the Western US and a major hurricane that left catastrophic damage from Puerto Rico to Atlantic Canada.
Hurricane force winds extend outward up to 40 miles from Ian’s center and tropical-storm strength winds reach out 140 miles, the agency said. Tropical storm conditions are expected to last through the morning in the Florida Keys. Some parts of central Florida could get two feet of rain.
Ian’s winds are still forecast to peak at 130 miles per hour in the next 12 to 24 hours, making it a Category 4 storm on the five-step, Saffir-Simpson scale, the hurricane center said. Landfall is expected Wednesday.
Ian already triggered floods and a nationwide blackout Tuesday when it made landfall as a Category 3 storm in western Cuba, the heartland of the island’s tobacco industry. The storm ripped off roofs, uprooted trees and flooded streets, with most of the damage concentrated in the westernmost province of Pinar del Rio.
President Joe Biden told media at a Washington event that he approved Florida requests for emergency assistance. The Federal Emergency Management Agency has deployed 700 personnel to the state and its governor activated 5,000 troops from the state’s National Guard with another 2,000 expected from other states, Biden said.
About 2.5 million people along Florida’s Gulf coast were urged to evacuate in advance of Hurricane Ian, Governor Ron DeSantis said in a Tuesday afternoon briefing. Residents should brace for a major hit that could bring historic storm surge Wednesday, he said.
Tampa and the surrounding region has been preparing for the storm, with evacuation orders now in place from Levy and Lee counties, a stretch of more than 240 miles along the western shoreline. Ports around Tampa, St. Petersburg and Manatee have been closed, according to the US Coast Guard.
Duke Energy Corp., which supplies electricity to 1.9 million customers in the state, warned of extended power outages. Tampa Electric said it would proactively cut power to low-lying areas of downtown Tampa to avoid saltwater damage to its equipment, but later walked that back after the storm’s projected track shifted.
Walt Disney Co. is shutting down its Florida theme parks on Wednesday and Thursday, while SeaWorld Entertainment Inc. closed Busch Gardens in Tampa through Sept. 29.
Tampa International Airport suspended operations Tuesday and American Airlines Group Inc. issued a travel alert for 20 airports in the western Caribbean and Florida. Orlando International Airport was set to halt flights of 10:30 a.m. Wednesday. Airlines have canceled more than 2,800 flights for the region through Thursday.
US carriers added at least 14 extra flights to Florida cities Tuesday as the hurricane approached, according to spokespeople. United Airlines Holdings Inc. also shifted to larger aircraft in order to carry more passengers on one flight each into Tampa, Sarasota Bradenton International and Southwest Florida International in Fort Myers, spokesman Joshua Freed said.
The storm appears likely to intensify food inflation as Ian takes direct aim on crucial orange-growing and fertilizer-manufacturing zones. At least 75% of the state’s orange groves are under threat, according to Maxar Technologies Inc. meteorologist Donald Keeney. Meanwhile, key Mosaic Co. phosphate facilities east of Tampa also are at risk, Bloomberg Intelligence analyst Alexis Maxwell said.
Photo: Tampa International Airport (TPA) ahead of Hurricane Ian in Tampa, Florida on Sept. 27, 2022 / Bloomberg
Ian was initially expected to make a direct hit on the Tampa Bay and St Petersburg region – the first direct hit on this area in 101 years – but the latest forecasts show the storm moving further south.
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Striking the Tampa area would be a “worst case scenario”, said Richard Olson, director of the extreme events institute at Florida International University (FIU).
The Tampa region is among the most vulnerable places for severe flooding. Low elevation, rising sea levels, and a large population increase the risk of a catastrophic tidal surge and the area has all three.
Over the last 50 years, development has surged along the Tampa region’s nearly 700 miles (1,126km) of shoreline, with people and buildings scattered along the mostly low-lying beach.
“We’ve moved toward the coast, we’ve moved toward the water. This is, in its own way, a human nature trainwreck,” Mr Olson said. “It’s a terrible thing to say, but it’s a little better if it [Ian] hits south.”
Hurricane Ian was about 75 miles off the coast at 05:00 local time (09:00 GMT) when the NHC announced it had become a category four storm.
People in the highest risk areas such as Charlotte county, where the hurricane is expected to make landfall, have been urged to “hunker down and prepare for the storm”.
Governor DeSantis said: “It’s no longer possible to safely evacuate”, adding that people should keep off the roads and make their way to shelters.
The area at highest risk spreads from Naples to the Sarasota region, said the NHC.
Tornadoes have already been seen in southern Florida, the National Weather Service said. Conditions were “rapidly deteriorating” along the south west coast of Florida at 06:00 local time (11:00 GMT), the NHC reported.
Ian is likely to lose speed as it nears Florida, effectively prolonging the storm’s effects and threatening up to 20in (1.6ft) of rain in some areas.
Governor DeSantis said there was a “major” recovery effort in place for after the storm has passed including emergency services and linemen.
He urged residents to be “cautious” and avoid hazards such as down power lines, standing water and damaged trees.
Mr Olson said his “constant worry” as Hurricane Ian neared the coast was “under-evacuation”, On Tuesday, police went door-to-door in some areas and asked people to leave.
Image caption,Residents are buying supplies as they brace for the storm
Residents have been buying water bottles in bulk, boarding up windows and moving garden furniture inside. Schools and universities have also cancelled classes for the week.
Theme parks such as Disney World, Sea World and Busch Gardens in Tampa are closing as the storm bears down, while Nasa has postponed the planned launch of a moon rocket at Kennedy Space Center.
As flights landed in Tampa on Tuesday, mobile phone alerts blared notifying residents of mandatory evacuation orders across the region.
In the airport, one man said he had not faced the prospect of a hurricane like this in his 43 years of living in the area. “It’s the calm before the storm,” he said.
Despite monitoring by Florida regulators, cancellation of more than 56,000 policies, and an extensive restructuring plan this year, FedNat Insurance Co. is now insolvent and must be liquidated – the sixth Florida property insurer this year to throw in the towel.
The Florida Department of Financial Services on Friday filed a consent agreement with the Leon County Circuit Court, detailing the extent of FedNat’s financial troubles and asking the court to approve DFS as the receiver for the insurer. The move was not unexpected, after FedNat agreed in May to cancel policies, transfer others to a sister company and wind down operations with what regulators hoped would be an orderly runoff. The Demotech financial rating firm also withdrew its stability rating for FedNat on Aug. 1.
Still, the insolvency comes at a perilous moment for Florida, as a major hurricane bears down on the state’s west coast and the heavily populated Tampa area. Policyholders and agents have had to scramble all year to find new coverage as carriers have gone under or have canceled some policies, non-renewed others or refused to write more business in Florida.
Florida Association of Insurance Agents President Kyle Ulrich said Monday afternoon that his team is still considering what the FedNat insolvency means for agents.
The liquidation will likely force more Florida homeowners to seek coverage with Citizens Property Insurance Corp., the state-created insurer of last resort. Citizens this year became the largest insurer in the state but its commissions paid to agents are generally lower than those paid by most primary-market carriers.
“I would say that fewer insurers means more policies in Citizens,” said Michael Carlson, president of the Personal Insurance Federation of Florida.
And more exposure for Citizens could result in surcharges on policyholders if major hurricanes strike the state this year and eat up enough of Citizens’ surplus, he said.
The DFS petition indicated that FedNat’s troubles have been a long time coming but that the end of the 21-year-old company became obvious two weeks ago.
On Sept. 13, FedNat officials notified the state Office of Insurance Regulation “that it had overstated its cash position and could not complete a solvent runoff,” the court filing explained. The next day, the Sunrise, Florida-based FedNat said it did not have enough cash on hand to pay its obligations and debts.
“Therefore, respondent is insolvent” as defined by Florida law, and delinquency proceedings are now appropriate, DFS wrote. The carrier’s board of directors has consented to liquidation and won’t request a hearing on the matter. The court also was asked to formally approve the transfer of 78,000 policies to FedNat’s affiliated company, Monarch National Insurance.
An 8-page affidavit included in the DFS petition provided some details about FedNat’s plight. The affidavit was signed by Virginia Christy, OIR’s director of property and casualty financial oversight, a familiar name to those who have followed Florida’s insurer insolvency saga in recent years.
FedNat began in Florida in 2001 as American Vehicle Insurance Co., but changed its name to FedNat. It is 100% owned by FedNat Holding Co., a publicly traded firm. (Shares of FedNat on the Nasdaq exchange closed Monday at 22 cents, down from a 1-year high of $2.81 in November of 2021, according to Yahoo! Finance. In 2018, before FedNat Insurance experienced heavy losses after storms in Louisiana and Texas, shares traded as high as $26.)
After FedNat’s 2019 financial statement showed a significant drop in net income and surplus and a $39 million underwriting loss, the OIR required the company to start filing monthly financial reports and to have regular phone calls with regulators. But the red ink continued, with FedNat posting a $97 million underwriting loss for 2020 and $106 million for 2021, Christy’s affidavit explained.
In April 2022, “in light of FedNat’s continued surplus decline,” OIR ordered it to take remedial measures and file a strategic plan. A month later, the office took the extraordinary step, allowed by state law, of ordering the cancellation of 56,000 of FedNat’s 140,000 homeowner policies in Florida. Most of the remaining policies were to be assumed by Monarch National. That transaction closed June 30. A Charlotte-based investment firm, Hale Partnership Capital Management, in May agreed to invest $15 million in capital into Monarch. FedNat also contributed capital to Monarch.
In August, FedNat officials submitted a runoff plan for its remaining liabilities. The OIR also approved the merger of affiliate company Maison Insurance Co. with FedNat, giving the firm some additional capital.
FedNat President Michael Braun
The steps were not enough. On Sept. 14, OIR sent an examiner to determine FedNat’s true financial position. Later that day, the company’s management admitted the firm was insolvent.
The affidavit and consent agreement did not indicate the extent of outstanding claims that the Florida Insurance Guaranty Association will have to pay as part of FedNat’s liquidation proceedings, or if FIGA will have to raise funds to pay the claims. FIGA in the last 12 months has levied assessments of 1.3% and 0.7% to pay claims after other Florida insurers were deemed insolvent.
The decline of FedNat is seen as another sign of the times in a Florida market beset with excessive litigation and what many have termed fraudulent and exaggerated roof claims. At one time, FedNat was one of the larger insurers in the state. At the end of 2021, the carrier still held 2.8% of the Florida market and had $336 million in direct written premiums, almost as much as American Integrity Insurance, the AM Best financial rating firm reported.
FedNat officials have not usually responded to request for comment from Insurance Journal about the firm’s financial difficulties.
It’s possible that more Florida property insurers could soon face insolvency and liquidation. United Property & Casualty Insurance Co. in August announced that it was pulling out of Florida and other states and was entering an orderly runoff plan, similar to what FedNat promised earlier this year.
Florida’s governor has declared a state of emergency for the entire state, days before a hurricane named Ian is expected to make landfall, raising the dread level for property insurers fearing heavy weather losses during one of the toughest moments for the industry.
Gov. Ron DeSantis’ declaration also triggered a bulletin from the state Office of Insurance Regulation, reminding health insurers and workers’ compensation insurers to allow early refills of prescription medicines.
Insurers licensed by OIR “shall waive time restrictions on prescription medication refills, which include suspension of electronic ‘refill too soon’ edits to pharmacies,” the office said.
The impending storm also forced the postponement of a Florida Division of Workers’ Compensation workshop on physician dispensing rules that was set for Thursday in Tallahassee.
The National Hurricane Center said Ian was expected to become a major hurricane before making landfall by Thursday. The storm sucked up energy Monday morning from an area in the Caribbean Sea with “super warm water,” low wind shear and favorable steering currents — factors that will make the storm stronger, the Miami Herald reported.
A range of landfall scenarios from the southwest Florida Peninsula to the western Florida Panhandle are very plausible this week, said a report from Guy Carpenter, the reinsurance firm.
“At this point really the right message for those living in Florida is that you have to watch forecasts and get ready and prepare yourself for potential impact from this tropical system,” John Cangialosi, a senior hurricane specialist at the Miami-based NHC told the Associated Press.
The NHC most-likely forecast splits the difference with a track through the Florida Big Bend region, an area far from the largest cities but still vulnerable to residential and commercial losses. To give an idea of the potential for property losses in the area, Insurance Journal looked at data from the OIR’s Quarterly and Supplement Report from insurers. For the eight coastal counties in the Big Bend area, Citizens Property Insurance Corp., the largest property writer in the state, held more than 27,400 policies at the end of the second quarter this year. That translates to billions in exposure.
For one sparsely populated county in the area, Wakulla, just south of the state capital of Tallahassee, Citizens had some 488 policies in force. The total exposure, including wind coverage, comes to about $91 million. Since the second quarter report, exposures have increased sharply in many areas. In Hernando County, closer to Tampa, for example, Citizens now has 22,628 policies and some $8.2 billion in exposure, a spokesman for Citizens said Monday.
Even if the hurricane is not as powerful as some major storms in years past, rising material costs could mean huge costs for insurers.
If the storm turns slightly to the east, it could affect the Tampa Bay area, which is home to about 3 million people and is particularly vulnerable to storm surge and coastal flooding, according to news reports.
In Pinellas Park, near Tampa, people were waiting in line at a Home Depot when it opened at 6 a.m., the Tampa Bay Times reported. Manager Wendy Macrini said the store had sold 600 cases of water by the early afternoon and ran out of generators.
People also were buying up plywood to put over their windows: “Better to have it and not need it than to need it and not have it,” Matt Beaver, of Pinellas Park, told the Times.
The governor’s declaration frees up emergency protective funding and activates members of the Florida National Guard, his office said. His order stresses that there is risk for a storm surge, flooding, dangerous winds and other weather conditions throughout the state.
Elsewhere, powerful post-tropical cyclone Fiona crashed ashore early Saturday in Nova Scotia in the Atlantic Canada region. The storm washed houses into the sea, tore rooftops off others and knocked out power to the vast majority of two Canadian provinces with more than 500,000 customers affected at the storm’s height.
Graphic: Probability wind map for Hurricane Ian. The purple indicates 90% or greater chance of tropical-storm-force winds (39 mph or greater). Source: National Weather Service, as of early Monday morning, Sept. 26.
TAMPA, Fla. (WFLA) — Florida homeowners will see their bills go up as the state’s property insurance crisis continues. Multiple insurance providers in the state have left the market, even after a special legislative session was held to address business and homeowner needs. Now, residents themselves are footing the bill from companies pulling out of Florida.
In August, another insurance company was added to the list of providers that became insolvent, the tenth since April 2021. The Florida Insurance Guaranty Association is the state-created non-profit which “establishes and maintains a service-oriented operation for processing covered claims of insolvent members.” FIGA was established by the legislature in 1970.
For the second time in 2022, FIGA has issued a surcharge to homeowners on their insurance policy premiums, in order to cover claims from companies that have entered receivership. It’s the third time this has happened since 2020, according to FIGA. So far in 2022, FIGA assessments have approved surcharges to go up a collective 2%, with 1.3% added in March and another 0.7% added in August.
Citing Florida statutes, FIGA said “members will be able to recoup the .70% assessment from their policyholders over the Assessment Year starting January 1, 2023 through December 31, 2023.”
According to the request for new levy by OIR, “the liquidation of Southern Fidelity Insurancecompany resulted in FIGA receiving in excess of 5,000 claims with unpaid losses and return premium in excess of $178 million.”
FIGA reported to OIR that their forecasted cash flow would be “materially impacted” by the insolvency of Southern Fidelity. Thus, the non-profit said they need the collection of surcharges to continue into 2023. The letter from FIGA to OIR said the surcharge collections will “result in approximately $168 million in assessments for FIGA policies” through Dec. 31, 2023.
At the end of July, OIR announced a temporary reinsurance arrangement with Citizens Property Insurance Corporation while the ratings downgrade was weighed. The solution, according to OIR, would “allow insurers to meet an exception offered by the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation,” letting Floridians keep their homeowners coverage during hurricane season.
“OIR’s greatest priority is ensuring consumers have access to insurance, especially during hurricane season; and because of the uncertainty with the status of Demotech’s ratings, we’ve been forced to take extraordinary steps to protect millions of consumers,” Altmaier said in July.
Altmaier said the quick fix was an “innovative arrangement” that would let consumers keep coverage while allowing insurance agents to avoid moving policies, which would let lenders “have confidence that these insurers continue to meet mortgage qualifications.”
According to American Family Insurance, a national insurance company, property insurance is not technically, legally required for homes that are fully owned and no longer subject to mortgage payments, which are a loan. If a resident owns their home outright, there is no lender requiring payment, and thus, the insurance itself is optional. Many mortgage lenders do require insurance policies.
As of July, more than 30% of homes sold in Florida were paid for in cash, meaning there is no mortgage policy attached to them.
Bankrate, a consumer financial service company, says many insurance policies use a type of coverage known as replacement cost to calculate the monthly and yearly rates for coverage plans used by homeowners. However, the replacement cost refers to the cost to replace or rebuild a home that becomes damaged.
During the ongoing inflation issues facing the national and global economy, the prices of materials, a skilled labor shortage, and other supply chain problems have increased the costs for construction and repair. This has resulted in policy premiums increasing.
The median sell price for Florida homes was $412,303, according to Florida Realtors. This means that if you have a mortgage, your replacement cost, depending on the type of insurance plan you have, would cover about what you paid to purchase the home.
To handle the failing insurance companies, the assessment levies from FIGA have added the surcharges to fund payments to insurance claims filed by those losing the policies from the folded insurers.
While the total assessment for levies was increased a collective 2%, in 2020, the Florida Legislature allowed a potential for bigger increases due to emergency needs. “Emergency Assessments were increased from 2% to 4% annually during the 2020 legislative session,” according to FIGA. Before 2015, insurance companies paid assessment fees to FIGA, then added a surcharge to each policy until the money spent was recouped.
FIGA said in 2015, the assessment statute was amended by the legislature to allow FIGA to “obtain funds quickly, but also introduced an option for insurers to remit assessments” when they’re collected over a yearlong policy term. From 2013 to 2020, no assessments were levied, according to information from FIGA.
Since 2020, assessments were levied three times.
But, even with the added levies and subsequent surcharges, FIGA reports that they will only cover up to $300,000 in claims costs. This means that, at least for median prices of homes sold in July, Florida residents won’t be able to get a full replacement cost recouped for themselves if they need to file a claim. Instead, they’ll be shorted $112,000 on average, based on current market data.
By current policy choices, the costs of failing property insurance companies are now passed on to Florida residents, so a state-run insurance nonprofit can recoup the costs of paying out claims for the companies that have folded. “A public workshop will be held on September 21 by FIGA to provide members with information on how to report and remit surcharges collected for the 2022 Assessments,” according to the company.
As of 11 a.m., Tropical Depression Nine was moving west-northwest at 14 mph with maximum sustained winds of 35 mph. It was located 515 miles east-southeast of Kingston, Jamaica and 1,015 miles southeast of Havana, Cuba. It is expected to become a tropical storm by Friday afternoon.
In the latest forecast, the National Hurricane Center said the system could hit Florida as a major hurricane, or Category 3 hurricane. The National Weather Service urged Florida residents and visitors to gather supplies and track the forecast.
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“We still have Tropical Depression Nine, as of the 11 a.m. advisory,” WESH 2 meteorologist Kellianne Klass said. “Tropical Depression Nine is still expected to become a tropical storm later today, but it will struggle to do so. Conditions this weekend look more favorable for development. This storm is expected to strengthen to a major Category 3 hurricane with winds of 115 mph by Wednesday morning. There is still a lot of uncertainty about where exactly this system will make landfall in Florida. Southwest Florida to Tampa Bay are all in play for landfall. Still thinking the impacts for Central Florida will be around Tuesday through Thursday. GFS and European models are still not in agreement with the speed of the storm. GFS has the storm lingering off of the coast through Friday. The European model kicks the storm out by Thursday. This is still a fluid situation as we still need to fine-tune the exact landfall and timing of the storm.”
Below: WESH 2 Meteorologist Eric Burris takes deep dive into the tracks and modelsPlay Video
Stay tuned to WESH 2 News, wesh.com, or NOAA Weather Radio for storm updates.
Prepare to bring inside any lawn furniture, outdoor decorations or ornaments, trash cans, hanging plants, and anything else that can be picked up by the wind.
Understand hurricane forecast models and cones.
Prepare to cover all windows of your home. If shutters have not been installed, use precut plywood.
Check batteries and stock up on canned food, first-aid supplies, drinking water, and medications.
The WESH 2 First Warning Weather Team recommends you have these items ready before the storm strikes.
Bottled water: One gallon of water per person per day
Canned food and soup, such as beans and chili
Can opener for the cans without the easy-open lids
Assemble a first-aid kit
Two weeks’ worth of prescription medications
Baby/children’s needs, such as formula and diapers
Flashlight and batteries
Battery-operated weather radio
WHAT TO DO WHEN A HURRICANE WARNING IS ISSUED
Listen to the advice of local officials. If you are advised to evacuate, leave.
Complete preparation activities
If you are not advised to evacuate, stay indoors, away from windows.
Be alert for tornadoes. Tornadoes can happen during a hurricane and after it passes over. Remain indoors, in the center of your home, in a closet or bathroom without windows.
HOW YOUR SMARTPHONE CAN HELP DURING A HURRICANE
A smartphone can be your best friend in a hurricane — with the right websites and apps, you can turn it into a powerful tool for guiding you through a storm’s approach, arrival and aftermath.
Enable emergency alerts — if you have an iPhone, select settings, then go into notifications. From there, look for government alerts and enable emergency alerts.
If you have an Android phone, from the home page of the app, scroll to the right along the bottom and click on “settings.” On the settings menu, click on “severe weather alerts.” From the menu, select from most severe, moderate-severe, or all alerts.
PET AND ANIMAL SAFETY
Your pet should be a part of your family plan. If you must evacuate, the most important thing you can do to protect your pets is to evacuate them too. Leaving pets behind, even if you try to create a safe space for them, could result in injury or death.
Contact hotels and motels outside of your immediate area to see if they take pets.
Ask friends, relatives and others outside of the affected area whether they could shelter your animal.
The Home Insurance Guru 