Ron DeSantis Faces Criticism Over Florida’s Soaring Insurance Rates: ‘Floridians Bear the Brunt’
Florida residents are grappling with a severe insurance crisis that has been exacerbated by policy decisions made by the DeSantis administration, as outlined in a recent report from the American Federation of Teachers (AFT).
The AFT, an organization dedicated to advocating for fairness, democracy, and quality public education, has discovered that homeowner insurance rates in the Sunshine State are nearly triple the national average.
Industry experts express alarm at the steep insurance rate hikes, emphasizing the urgent need for reform. With Florida holding the dubious distinction of having the highest home insurance rates in the nation, these soaring costs have driven many residents to forego insurance altogether, which places vulnerable communities at even greater risk. This is particularly concerning given Florida’s susceptibility to hurricanes and other severe weather events linked to climate change.
Tracy, a community liaison specialist at Miami-Dade County public schools, serves as a tragic example of the crisis and the perilous gamble homeowners take when opting to go without insurance. Unable to afford the exorbitant premiums, she discontinued her home insurance and tragically lost her home to a fire.
“Our governor needs to understand that the cost of living we had three years ago is not what we have now,” Tracy lamented. “For a middle-class person to live comfortably, the cost of living needs to be lower, allowing for a life beyond living paycheck to paycheck.”
While self-insurance or forgoing coverage might seem like a money-saving strategy, it’s a risky proposition in a state like Florida, frequently plagued by hurricanes and severe weather. Even those seeking insurance coverage face obstacles, as some insurance companies have ceased writing new policies in disaster-prone states like Florida and California. As climate change-related weather events increase, insurers are either hiking prices or reducing coverage, introducing a new financial calculus for homeowners and potential buyers.
The DeSantis administration hasn’t been a passive observer in this crisis. In January, insurance prices were projected to increase by an average of 40% under its supervision. The administration implemented policy measures such as the creation of a $2 billion taxpayer-funded reinsurance fund, a move typically undertaken by insurance companies in the open market. Furthermore, Floridians lost the ability to recover attorney fees when suing nonpaying insurers, further tilting the scales against homeowners.
Political contributions have raised eyebrows in this context. It has been reported that Governor Ron DeSantis and his associated political committee received nearly $4 million from insurance industry stakeholders, a figure that balloons to almost $10 million when contributions to the Republican Party of Florida are factored in. The alignment between these donations and policies seemingly favouring insurers over homeowners has led to widespread questioning of the administration’s motivations.
Florida’s insurance challenges starkly contrast with states like Louisiana and Alabama, where better-regulated insurance markets and homeowner-friendly policies are in place. For instance, Alabama offers incentives for homeowners to fortify their properties against wind damage, effectively reducing insurance premiums. These approaches offer viable models for Florida, a state where the escalating insurance costs are driving some residents to leave or live without coverage, contributing to a surge in foreclosures and worsening the state’s housing crisis.