Home insurance costs in Florida are on the rise once more. After a brief period of stabilization in 2024, recent data suggests that homeowners may face continued premium hikes moving into 2025.
According to an analysis of insurance market share data from the third quarter of 2024, the statewide average premium for an all-perils single-family home policy increased by 3.1% between the second and third quarters. This follows two quarters of smaller increases at 1.3%, attributed to fewer lawsuits, a mild hurricane season in 2023, and smaller reinsurance cost hikes.
Rising Premiums: The Numbers at a Glance
- 2024 Q3 Average Premium: $3,668
- 2024 Q2 Average Premium: $3,558
- 2022 Q2 Average Premium: $2,798
From the second quarter of 2022 to the third quarter of 2024, premiums have risen by a staggering 31%.
What’s Driving the Increase?
Industry experts suggest inflation and rising costs for building materials and labor are the primary drivers behind the increase. According to Paul Handerhan, president of the Federal Association for Insurance Reform:
- Inflation likely accounts for two-thirds of the 3.1% increase.
- Higher home values are also contributing, as policies factor in coverage for the home’s contents and liability claims.
- Average insured home values increased by 2.3%, from $697,034 to $712,757, between the second and third quarters of 2024.
Additionally, Florida’s Hurricane Catastrophe Fund has raised deductibles for insurers, increasing their reliance on private reinsurance, which further impacts premiums.
Is a New Upward Trend Emerging?
While the recent spike raises concerns, some experts argue it may be too early to predict a long-term trend. Handerhan notes that the cost to insure each $1,000 of value rose only slightly, from $5.10 to $5.15 — a less than 1% increase.
Factors to watch moving forward include:
- Building material and labor costs in regions recovering from hurricane damage.
- The ongoing impact of inflation.
- Legislative actions regarding reinsurance and deductibles.
Condo Owners Get a Break
There’s good news for Florida condominium owners:
- Condo unit premiums rose by just 1.3%, to an average of $1,737.
- Commercial coverage for condo associations saw a 3% decrease, following significant increases in prior years.
What This Means for Florida Homeowners
For those owning single-family homes, the impact of rising premiums varies by insurer. For example:
- Centauri Specialty policies saw the largest average increase, at 37.8%.
- Nationwide Mutual customers experienced a 6.6% decrease in premiums.
- Olympus Insurance saw a 23.2% premium increase but attributed much of this to higher insured home values, which rose by 14.8%.
How Vacay & Co. Real Estate Can Help
At Vacay & Co. Real Estate, we understand that rising insurance costs can impact your homeownership experience. If you’re considering buying or selling a property in Florida, especially in the vacation home market near Disney, our 20+ years of expertise can help you navigate these challenges. Whether you need advice on budgeting for insurance premiums or maximizing the value of your property, we’re here to guide you every step of the way.
📩 Contact us today!
📞 Phone: 321-333-1338
🌐 Website: www.vacayreflorida.com