Florida's homeowners insurance market has experienced a dramatic disruption over the past five years. Between 2020 and 2025, more than a dozen private insurance carriers either became insolvent, withdrew from the Florida market, or stopped writing new policies. Premiums in many parts of the state have doubled or tripled. Understanding why is essential for anyone buying a home in Florida.
Why Florida Insurance Is So Expensive
Hurricane losses: Ian (2022), Idalia (2023), and the residual impacts of Irma (2017) and Michael (2018) depleted reinsurer capital and forced smaller carriers into insolvency. When a carrier fails, their policies are absorbed by Florida's Citizens Property Insurance — the state's insurer of last resort — which now covers over 1.4 million policies.
Assignment of Benefits (AOB) fraud: For years, contractors and attorneys abused AOB agreements, generating inflated or fraudulent claims, especially for roof replacements. Florida's legislature curbed AOB abuse in 2022-2023, which is beginning to stabilize the market.
Reinsurance costs: Florida insurers buy reinsurance every year before hurricane season. After successive loss years, global reinsurers dramatically increased Florida rates or refused to write coverage at all. Without reinsurance backing, carriers cannot legally operate.
Litigation volume: Florida historically accounted for less than 10% of U.S. homeowner insurance claims but more than 70% of homeowner insurance lawsuits. Legal reforms in 2022 and 2023 eliminated one-way attorney fee provisions and AOB.
Citizens Property Insurance: What You Need to Know
If private insurers will not cover your home, Citizens Property Insurance Corporation is the state-backed insurer of last resort. Citizens covers personal residential properties and is available throughout Florida. Premiums are capped by statute but are rising — a 12% annual rate increase is permitted.
Citizens depopulation program: Citizens is legally required to try to reduce its policy count. Each year, private carriers can offer to take over Citizens policies. If the offer is within 20% of the Citizens premium, the policyholder is automatically moved unless they opt out.
Sinkhole coverage: Citizens offers sinkhole coverage (required separately in some counties). Florida's limestone geology makes this matter particularly in Hernando, Hillsborough, Pasco, Pinellas, and Sumter counties — the so-called sinkhole alley.
What Coverage You Need in Florida
Standard homeowners (HO-3): Covers the structure against all perils except those specifically excluded. Wind and hurricane ARE covered in standard policies — but flood is NOT. This surprises many new Florida homeowners.
Flood insurance (separate): Purchased separately through the National Flood Insurance Program (NFIP) or private flood insurers. Required by lenders for homes in FEMA Special Flood Hazard Areas (zones AE, VE, AO). See our Florida Flood Zones guide for full details.
Wind mitigation inspection: Florida insurers must give discounts for wind mitigation features — hip roofs, hurricane straps, impact windows, shutters, and reinforced garage doors. A wind mitigation inspection ($75-$150) can generate $300-$2,000 per year in premium savings and is valid for 5 years.
Roof age matters enormously: Insurers increasingly refuse to write policies on homes with roofs over 15-20 years old. If you are buying a home with an aging roof, get a 4-point inspection and factor roof replacement cost into your purchase negotiation.
How to Shop for Florida Homeowners Insurance
Use an independent insurance agent — not a captive agent tied to one carrier. Independent agents can quote multiple carriers simultaneously and often have access to smaller Florida-domiciled carriers not available through big national brands. Demotech-rated carriers are common in Florida; a Demotech A rating is sufficient for most lenders.
Key questions to ask: What is the roof age/material policy? Is the policy HO-3 (open peril) or HO-8 (named peril)? What is the hurricane deductible (often 2-5% of dwelling value, separate from standard deductible)? Are screen enclosures and detached structures covered? Is mold coverage included?
2025-2026 Market Outlook
The Florida market is beginning to stabilize. Several new carriers have entered the market following 2022-2023 legal reforms. Reinsurance costs moderated slightly in 2024. Citizens is actively depopulating.
If you are buying a home in Florida, budget $3,000-$8,000 per year for homeowners insurance on a typical single-family home. Coastal and South Florida properties run higher; inland Central Florida properties run lower. Get insurance quotes before you make an offer.