Analysis Says Florida Is Most Expensive State For Homeowners Insurance

Editor’s Note: Democratic gubernatorial candidate David Jolly is proposing that ALL homeowner’s insurance be moved into a state catastrophic fund, saying that the fund would “remove[s] natural disaster perils from the private market would dramatically reduce property and car insurance rates, restoring affordability and price stability for millions of Floridians. ” [Jolly’s website]

Florida has made some gains in reducing homeowners insurance costs in recent years. But the state still has the most expensive premiums for coverage in the U.S., according to a new realtor.com analysis.

The real estate market monitoring company conducted a study on homeowners insurance costs across the country, and the Sunshine State is pretty costly compared to other states.

“Florida tops the charts in more ways than one: In addition to carrying the highest median premiums, it also has the dubious honor of having the most homeowners paying over $4,000 per year,” the realtor.com analysis concluded.

Colorado, Nebraska and Texas followed Florida in the ranking. The report linked the most expensive places for premiums with a simple connection: extreme weather conditions. Kansas, Oklahoma and Louisiana were also ranked in the top 10.

“Disaster risk varies widely by geography, with coastal areas obviously susceptible to hurricane-related damage a prime example,” said realtor.com senior economist Jake Krimmel. “But flood risk extends into the heartland, too, especially for properties located near rivers and their flood plains. This is not to mention tornado alley in the Plains or wildfire risk on the West Coast.”

Florida’s ranking as having the highest homeowners insurance costs in the county comes as the state has gone out of its way to lower those premiums.

Florida Chamber of Commerce President and CEO Mark Wilson this month said legislative modifications to the state’s insurance laws in 2022 and 2023 have sparked a “wave” of insurance companies entering the market. There are now 15 new companies that have emerged in the state’s property insurance market since those changes a few years ago, which restricted incentives for frivolous lawsuits that prompted many insurance businesses to hike premiums or leave the state entirely.

Still, Florida outpaces most homeowners insurance premiums by comparison, even among the other states that realtor.com analysts said are among the most expensive. States such as Texas and Colorado are seeing homeowners paying between $2,000 to $2,499 per year for insurance policies, substantially lower than Florida.

Residents holding mortgages are paying about twice as much as those without mortgages. Those insurance prices are also straining housing markets in many states that are being tested on affordability.

“Insurance costs are increasingly shaping affordability, especially in this high-rate, high-priced environment,” Krimmel said. “It’s just another added, and quite necessary, cost for owning today and moving forward.”

The most affordable states for homeowners insurance costs include Ohio, Pennsylvania, Vermont and New Hampshire, where those annual rates run between $800 and $1,500.