A severe hurricane hasn’t hit Florida since 2005, but residents are still paying the highest homeowners rates in the country, according to a report from the National Association of Insurance Commissioners.
Average insurance premiums in the state totaled $2,115 in 2013, up from $2,084 the previous year, and almost twice the national average of $1,096.
The NAIC report, released early last week, shares the average annual bill consumers face for home coverage. Some states, like Florida, stood out like sore thumbs, thanks to higher-than-average rates of catastrophe, as well as factors like population density and real estate and construction costs.
In descending order, the states with the highest average costs for homeowners insurance include:
10. Massachusetts - $1,263
9. Connecticut - $1,274
8. Alabama - $1,323
7. Rhode Island - $1,334
6. Kansas - $1,343
5. Mississippi - $1,395
4. Oklahoma - $1,654
3. Louisiana - $1,822
2. Texas - $1,837
1. Florida - $2,115
Though insurance companies defend the higher rates in these states, consumer advocates – particularly those in Florida – are speaking out against what they feel are disproportionate costs.
“The annual premium increases are not justified,” Nicole Vinson, a Tampa insurance attorney and head of Policyholders of Florida, told the Palm Beach Post. “In addition to paying more, policyholders are receiving less coverage than our neighboring states, even those on coastlines.”
Insurers, meanwhile, say attorneys, contractors and other parties have artificially inflated claims for things like plumbing leaks, which cause rates to increase even in non-hurricane years.
Others argue that the absence of hurricanes in the past 10 years does not preclude the possibility of their return.
“Florida has the highest property insurance rates because it has the nation’s highest insured catastrophe losses – and that remains true despite 10 storm-free years,” said Lynne McChristian, a Florida representative for the Insurance Information Institute.
McChristian pointed to Florida’s $68 billion in insured catastrophe losses during the period of 1985 to 2014.
And it isn’t just private insurers. Florida Lieutenant Governor Carlos Lopez-Cantera told a state Senate panel this year that state-run Citizens Property Insurance Corp. needed to raise rates in South Florida for the same reason.
“This is a growing problem,” he said. “There’s significant evidence this is leading to higher premiums.”
Vinson, however, says the idea of a “water claims crisis” is dubious.
“Sadly, I have to advise my clients not to be surprised premiums increase but the coverage is less than it was last year,” she said. “Floridians should pay close attention because the coverage for residential claims is being sliced and diced but the price tag is going up.”
On the opposite end of the spectrum, consumers paying the least for homeowners insurance in 2013 lived in Idaho ($561), Oregon ($568), Utah ($609), Wisconsin ($665) and Washington state ($676).