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Homeowners Struggling With Challenging Insurance Market

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For the last 27 years, Gary MacDonald and his wife have lived in a home that is a little piece of heaven near Homestead.

“The house is nice on the inside with big, vaulted ceilings,” he said.

They’ve raised their kids there and now spend their days enjoying what they’ve built.

“It’s home,” he said. “It’s a family home.”

It’s a home they have protected over the years with homeowners’ insurance, but Gary says every time his policy is up for renewal he is unsure of what to expect.

“It’s terrible,” he said. “The anxiety is really frustrating.”

Earlier this month, that anxiety got worse when Gary learned their insurer, Avatar Property and Casualty, had canceled their policy. A message posted on their website says the company “…is currently in the liquidation process by the Florida Department of Financial Services.”

The move is impacting people like Gary who, according to the Insurance Information Institute, is one of the company's nearly 40,000 policyholders in the state.

“I was worried about were my rates going to go up,” he said. “But now it was even worse. I didn’t have coverage or nowhere I was going to get coverage. Fortunately, again, because I have a good insurance agency, they immediately got on it.”

Still, he says the options he was given were less than desirable.

“The options were terrible,” he said.

The cheapest was $6,000. The other quotes were around $9,500, $12,000 and $25,000 – all for the same coverage levels he had under Avatar.

“I mean, yes, there’s people who $24,000 is a drop in the bucket,” he said. “To me, that would have been devastating.”

Gary went with the cheapest option, even though it was about $2,000 more than his Avatar premium. And he’s not the only one having to make difficult decisions.

NBC 6 Responds is hearing from dozens of South Florida homeowners who are facing soaring renewal rates or policy cancellations. 

One viewer says she was covered by St. Johns Insurance, which was ordered liquidated in February. Her policy was transferred to a new company and she says she’s now facing a $1,800 increase.

Another viewer says his policy jumped $2,600. He wrote he will “…be dropping insurance completely this coming December. My wife and I are retired on social security, and this one bill takes 60% of one of our checks.”

“We are hearing similar stories from across the state where retired citizens on fixed incomes are being priced out of the market,” said Mark Friedlander of the Insurance Information Institute.

Friedlander says they’re expecting premiums to jump another 30 to 40 percent on average this year. He also says homeowners could soon have even fewer options.

“Right now, Florida is the most treacherous property insurance market in the country,” he said. “We have companies that have been liquidated, others that may be headed in that direction.”

Florida has not had a major storm hit since Hurricane Michael in 2018. Still, Friedlander says insurance companies are reporting billions of dollars in losses, thanks in large part to what he describes as frivolous lawsuits. In 2021 alone, he says 116,000 property insurance lawsuits were filed in Florida. He says no other state had over 900, adding that relief is nowhere in sight.

“Because of the inaction of the Florida legislature this year, the property insurance market in our state is getting worse and is on a trajectory to collapse,” he said. “There’s just not going to be any options for Florida homeowners to get coverage with private insurers.”

As for Gary, he says he’s figured out a way to deal with the new, higher premium.

“I’m just going to have to set aside a little bit of extra money a month in order to pay that,” he said.

But he worries about others who may not have that option.

“The people who drive this country, the people who are the first to enlist in the military, the people who are the first to become police officers and firefighters -- they're the ones that are impacted by this,” he said. “And when you drive these people out of South Florida, what do you have left?”

NBC 6 wants to hear from homeowners and the issues they’re facing as they navigate Florida’s homeowners’ insurance market.

To participate in the survey and possibly be included in an upcoming story, click here.

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