Will My Homeowners Insurance Go Up Because of the Hurricane?

Probably not because of this storm specifically, and that’s genuinely good news after a hurricane this size. Two outfits that rate insurance companies looked at Hurricane Isaias this week, and neither one thinks it’s big enough to move the market on its own.

What Did the Rating Agencies Actually Say?

Karen Clark & Company put the privately insured loss from Isaias at about $3 billion, covering homes, businesses, cars and business interruption together. The same morning, AM Best put out a commentary titled “Hurricane Isaias Insured Losses Likely Limited to an Earnings Event,” putting the number in the low single digit billions and saying it isn’t expected to eat into insurer surplus enough to change capacity in Florida. In AM Best’s own words, that helps the market avoid a squeeze that would otherwise hit reinsurance pricing. AM Best’s analyst, Christopher Graham, still added the caveat that matters: this “again highlights the difficult nature of operating in Florida, as insurers may wish to protect their capital.”

Why Would My Rate Go Up Anyway?

Because a rating agency’s outlook isn’t a rate filing. Rates in Florida get approved by the state’s Office of Insurance Regulation, one carrier at a time, and nothing about this week’s numbers stops an individual company from asking for more. The two agencies agree on the storm as a whole. They say nothing about what your specific carrier decides to file next quarter.

What About Citizens, the One That Can Reach You Even if You’re Not a Customer?

AM Best also flagged that Citizens, the state’s insurer of last resort, should come through this season intact. That matters more than it sounds like it should, because Citizens is the one carrier whose losses can land on you even if you’ve never held a Citizens policy, through an assessment charged across Florida policyholders generally. Citizens secured $2.82 billion in reinsurance for this season specifically so it could pay out after a 1-in-360-year hurricane without levying one. It’s carrying 254,413 policies as of this month.

So What’s the Bottom Line if You’re Already Stretched?

Premium, not falling prices, is the thing that’s been pushing current homeowners toward short sale territory. A storm that doesn’t move the market price of coverage is about the best outcome that could’ve landed on a household already stretched thin. Just keep the limit in mind: it’s a market-wide read, not a promise about your own renewal notice.

In other news, the claims aren’t showing up the way you’d expect a week after landfall, and the reason has nothing to do with how bad the damage is.

My Hurricane Damage Is Less Than My Deductible. Do I Just Pay for It Myself?

Yes, probably, and that’s one of the quietest ways a storm costs people money without ever showing up in a claims count anywhere.

Why Are So Few Claims Being Filed?

A week after landfall, several carriers are reporting claims at a fraction of their policy counts. People’s Trust Insurance had taken just over 400 claims from about 8,000 insureds in the region. Universal Property & Casualty had about 3,000 claims on roughly 20,000 policies. Citizens was sitting at 860 claims against about 8,800 policies in the ten counties hit at landfall. Matt Mercier, national director of community associations at CBIZ, gave the plain reason to Insurance Journal: “So much of what we have seen has been below the deductible.”

I walked through how Florida’s hurricane deductible actually works here on the 9th, the short version is it’s a percentage of your dwelling coverage, not a flat dollar figure, and it can run into five figures depending on your policy. A torn section of roof, a soffit, a fence and a tree removal can add up to a real repair bill and still land under that number.

What Happens When the Repair Bill Comes in Under the Deductible?

You pay for it yourself, out of your own pocket, on top of whatever else is already due that month. Doug Quinn of the American Policyholder Association, working the Panhandle this week, called it “the storm after the storm.” Mark Friedlander of the Insurance Information Institute pushed back the same week, saying “legitimate claims are not being denied.” Both are real positions from people who work this for a living, and neither one is a settled fact yet.

Does a Low Claims Count Mean the Storm Was Mild?

Depends who’s reading it. The trade press is reading a low claims count as a sign the storm came in lighter than feared, and on the numbers, that’s a fair read for the industry as a whole. For a household staring at a repair bill that didn’t clear the deductible, it can mean the opposite: a bill that has to come out of savings most families don’t have sitting around, with nothing about it showing up in anybody’s claims data. That phone call to an agent usually doesn’t happen the week of the storm. It happens months later.

Jacksonville, Florida is where I work, and distressed property from storms like this one is a big part of it. Happy to walk through what either of these means for your own situation.

JimArmstrong904@gmail.com, or (904) 671-4161 if a call’s easier.

Jim Armstrong, REALTOR® · Momentum Realty · SFR® (Short Sales and Foreclosure Resource) certified. This is general information, not legal, tax, or financial advice.

Momentum Realty is not associated with the government, and our service is not approved by the government or your lender.