Florida's property insurance market has undergone more disruption in the past five years than in any comparable period in recent history. Multiple carriers have exited or significantly reduced their Florida exposure. Citizens Property Insurance has grown to a scale that creates systemic risk. Premiums have increased dramatically. And legislative reforms passed in 2022 and 2023 have begun to change the conditions that drove the crisis. Property managers who understand where the market stands and where it is heading can give clients far better guidance on coverage decisions.
What Drove the Disruption
The Florida property insurance market deterioration resulted from a combination of factors that compounded over several years. The primary drivers were:
- Litigation abuse: Florida accounted for approximately 8% of all U.S. homeowner insurance claims but nearly 80% of all U.S. homeowner insurance lawsuits in the years leading up to the 2022 reforms. Assignment of benefits (AOB) fraud -- where contractors obtained the right to file and collect insurance claims on behalf of homeowners, then inflated scopes and sued insurers -- drove massive litigation costs
- Hurricane Ian and Nicole (2022): Ian was one of the costliest hurricanes in U.S. history. The combination of direct insured losses and the post-storm litigation that followed accelerated carrier losses to a point that made many Florida books of business unsustainable
- Reinsurance cost increases: Reinsurers -- the companies that provide insurance to insurance companies -- sharply increased rates and reduced capacity in Florida after the 2022 storm season. Higher reinsurance costs flow directly into policyholder premiums
- Construction cost inflation: Post-pandemic construction cost inflation significantly increased the cost of repairing and rebuilding damaged properties, increasing the average claim severity
Citizens Property Insurance Growth
As private carriers exited, more policyholders turned to Citizens Property Insurance -- Florida's state-backed insurer of last resort. Citizens grew from approximately 500,000 policies in 2020 to over 1.4 million policies at its peak, creating systemic concentration risk. Citizens is backed by assessments on all Florida policyholders -- including those not insured by Citizens -- if Citizens does not have sufficient reserves to pay claims after a major storm. This assessment risk affects every Florida property owner regardless of which carrier they use.
If Citizens experiences losses exceeding its reserves after a major storm, it can levy assessments on all Florida insurance policyholders -- not just Citizens policyholders. This means that even clients who are not insured by Citizens have financial exposure to Citizens's claims paying ability. Property managers should understand this when advising clients to evaluate Citizens vs. private market options at renewal.
Legislative Reforms That Changed the Market
Florida passed two significant reform packages aimed at reducing litigation abuse and improving market conditions:
SB 2-D (May 2022): Targeted AOB abuse by restricting assignment of benefits for residential property insurance claims and adding notice requirements before contractors could file suit.
SB 2-A (December 2022 special session): More sweeping reforms that eliminated one-way attorney fees in property insurance litigation, further restricted AOB for residential claims, shortened statutes of limitations for new claims and supplements, and changed the standards for roof claim settlements. These reforms were specifically designed to reduce the litigation economics that were driving carrier exits.
The early evidence suggests the reforms are working. Litigation rates have declined. Several carriers that had stopped writing new policies in Florida have cautiously begun accepting new business again. The market has not fully stabilized, but the trajectory has improved.
New Carrier Entrants
Several new carriers have entered the Florida market since the 2022 reforms, typically with backing from reinsurers who are more comfortable with the post-reform litigation environment. These carriers tend to be selective about the risks they write -- they are cautious about coastal exposure, scrutinize roof age carefully, and may be unwilling to write properties that Citizens or surplus lines carriers have declined. But their presence has added capacity to a market that was severely constrained.
What Continues to Drive Premiums Higher
Even with the reforms, Florida property insurance premiums remain elevated by historical standards. The primary drivers of continued premium pressure include:
- Reinsurance market: Global reinsurance costs remain elevated after multiple years of catastrophic losses globally, not just in Florida
- Climate exposure pricing: Reinsurers and primary carriers are increasingly pricing the long-term hurricane risk exposure into Florida premiums
- Construction costs: While inflation has moderated, construction costs remain above pre-2020 levels, which keeps average claim severity elevated
- Roof age: Florida's large stock of aging roofs creates ongoing underwriting pressure -- carriers are increasingly limiting coverage or adding restrictions on older roofs
What Property Managers Should Tell Clients About Renewal Season
The most important advice for clients approaching insurance renewal in the current market:
- Do not auto-renew: The renewal notice from the current carrier is not necessarily the best available option. Actively shopping the coverage at each renewal cycle is essential in a market where carrier appetite and pricing change frequently
- Start 60 days early: The Florida market still moves slowly enough that leaving less than 30 days for the renewal process can limit options
- Work with an independent broker: Independent brokers have access to multiple carriers and can compare options across the admitted and surplus lines markets. Captive agents can only offer one company's products
- Evaluate Citizens take-out letters carefully: When a private carrier offers to assume a Citizens policy through the depopulation program, that offer should be evaluated against Citizens coverage in terms of terms, deductibles, carrier financial strength, and claims service -- not simply accepted or rejected without review
- Watch for restrictive endorsements: Some carriers add coverage-restricting endorsements at renewal -- particularly ACV roof endorsements -- without prominently flagging them. Review the full endorsement list at each renewal
Clients who present well to underwriters -- current wind mitigation inspection, documented maintenance records, no recent claims, or a clean loss run showing closed claims -- get better terms than clients who cannot demonstrate property condition. Property managers who maintain good documentation throughout the year give clients a competitive advantage at renewal.
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Start Free -- No Card Required ->The Bottom Line
Florida's property insurance market has been through a period of severe stress driven by litigation abuse, catastrophic storm losses, and reinsurance cost increases. The 2022 legislative reforms have improved conditions, and private carrier capacity is slowly returning. But premiums remain elevated, carrier selectivity is high, and Citizens's large policy count continues to represent systemic risk. Property managers who understand these market dynamics can give clients far better guidance on coverage decisions -- particularly around renewal strategy, carrier evaluation, and Citizens depopulation decisions. For related guidance, see Citizens Property Insurance for Florida landlords, how to audit your Florida property insurance portfolio, and the insurance renewal checklist for Florida property managers.