Florida Homeowners Insurance: Save Big and Stay Protected

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Why Florida Homeowners Insurance Matters?

Having a home in Florida can be tricky in its own way. Sunshine and beaches attract millions, but hurricanes, sinkholes, and rising costs make homeowners insurance a major concern. The Florida homeowners insurance crisis isn’t just a headline—it’s something every buyer and homeowner feels in their wallet.

At Gustan Cho Associates, we work daily with families struggling with rising insurance premiums and lender requirements. If you don’t understand the insurance market, your mortgage approval could fall apart at the last minute. This guide explains the Florida homeowners insurance crisis, why costs keep rising, and how you can still protect your home and confidently close your loan.

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Why Is Florida Homeowners Insurance So Expensive?

When borrowers ask, “Why is my insurance bill so high?” the answer comes down to risk. Florida is more exposed to hurricanes, storms, and flooding than any other state. Here’s why premiums have skyrocketed:

Hurricane Damage

Florida’s vulnerability to hurricanes means that each storm brings devastating damage, leading to billions of dollars in insurance claims. This overwhelming financial burden ultimately contributes to higher premiums for all policyholders, as insurers adjust their rates to cover potential losses from future storms.

Insurance Fraud

Insurance fraud is a serious problem in Florida. Some contractors and lawyers submit fake claims. This kind of dishonesty ends up costing insurers millions, which leads to higher premiums for honest folks.

Reinsurance Costs

Insurers must purchase reinsurance to protect themselves against significant claims, especially in high-risk areas like Florida. The soaring prices of reinsurance directly impact the overall cost of insurance policies, resulting in higher premiums for homeowners and businesses alike.

Inflation

When inflation goes up, construction materials and labor costs also rise, making it more expensive to fix damage from natural disasters. As settling these claims gets pricier, insurance companies must bump their premiums to stay financially stable.

Many families now pay more than $5,000 per year in premiums, with some coastal counties charging even higher rates. The Florida homeowners insurance crisis means even middle-class families are being priced out.

What Is the Florida Homeowners Insurance Crisis?

The Florida homeowners insurance crisis combines insurers leaving the state, bankruptcies, and double-digit rate increases. Here’s what’s happening:

• Insurance Company Exits: Several insurers, including Southern Fidelity, Weston Property & Casualty, and FedNat, have withdrawn from the Florida market. This trend has contributed significantly to the insurance crisis, limiting homeowners’ options and increasing the strain on remaining providers.
• Citizens Property Insurance: Because of the ongoing crisis, Citizens Property Insurance, which is the state-run backup insurer, is now covering more than 1.3 million homes, hitting a new record high. This surge in policyholders underscores the challenges Floridians face in securing affordable coverage from private companies.
• Lawsuits & Fraud: Florida stands out for its high volume of insurance lawsuits, raising concerns about fraudulent claims despite a relatively small share of overall claims. This legal landscape has put additional pressure on insurers, contributing to rising premiums and a more volatile market.

This crisis leaves homeowners with fewer options, higher bills, and uncertainty about whether they’ll qualify for a mortgage.

Which Companies Still Offer Homeowners Insurance in Florida?

Homeowners often ask, “Who will insure me now?” While many companies left, a few still write policies:

• State Farm
• Citizens Property Insurance (state-backed)
• Universal Property & Casualty
• Tower Hill
• Security First

However, availability depends on your ZIP code. Some carriers will not service coastal or high-risk areas. That’s why working with an expert matters during the Florida homeowners insurance crisis.

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Citizens vs Private Insurers in Florida

Many borrowers wonder: “Should I get Citizens or go private?” Here’s a simple comparison:

Feature	Private Insurers	Citizens Insurance
Availability	Limited in high-risk areas	Statewide (last resort)
Price	Lower in safe areas	Higher in risky areas
Coverage Flexibility	More options	Stricter guidelines
Mortgage Impact	Usually preferred by lenders	Sometimes questioned in high-risk areas

At Gustan Cho Associates, we help borrowers weigh the pros and cons. In some cases, Citizens is the only choice to close your loan.

Hurricane Deductibles: What Borrowers Need to Know

In Florida, hurricane deductibles are different from standard deductibles. Most policies require 2% to 5% of your home’s insured value before coverage kicks in.

Example: If your home is insured for $300,000 and you have a 2% hurricane deductible, you must pay $6,000 before your insurer pays the rest.

This is an often-overlooked part of the Florida homeowners insurance crisis. Many buyers don’t realize how much they’ll owe after a storm until it’s too late.

Ways to Cut Costs on Homeowners Insurance in Florida

Despite the crisis, there are still ways to bring down costs:

• Raise deductibles for lower monthly premiums
• Bundle home and auto insurance
• Install storm shutters and impact windows
• Add security systems
• Request a wind mitigation inspection
• Maintain good credit

These steps can help offset the rising cost of the Florida homeowners insurance crisis and show lenders you’re financially prepared.

Impact of Sinkholes on Insurance Rates

Florida’s unique geology means sinkholes are another major risk. Counties like Pasco and Hernando are hot spots for sinkhole claims. Frequent claims in your area can raise rates for everyone.

Ask your insurer if sinkhole coverage is included or excluded in your policy—it can make a big difference in your mortgage approval during the Florida homeowners insurance crisis.

Legislative Fixes for the Florida Insurance Market

Florida actively addresses the ongoing homeowners insurance crisis through legislative changes to stabilize the market. Proposed measures include limiting lawsuits and fraud claims and allowing arbitration as an alternative to court proceedings. Additionally, the state is working to attract new insurers to re-enter the market, potentially enhancing competition and leading to better options for consumers.

While these long-term strategies are promising, homeowners face pressing challenges in securing affordable coverage and qualifying for mortgages. Immediate solutions are essential to support families needing insurance as they navigate this turbulent landscape.

Florida Homeowners Insurance and Mortgage Approval

Before you close on a loan, lenders need to see that you have homeowners insurance. If your insurance is canceled or too expensive, your mortgage may fall apart.

At Gustan Cho Associates, we help borrowers by:

• Connecting with insurers who cover your ZIP code
• Estimating escrow for taxes and insurance
• Meeting lender guidelines without delay

Even in the middle of the Florida homeowners insurance crisis, we get loans closed that others can’t.

First-Time Buyers: Don’t Get Caught Off Guard

If you’re a first-time homebuyer in Florida, start shopping for insurance when your offer is accepted. Don’t wait until closing week. Get multiple quotes, ask about flood insurance, and budget for your hurricane deductible.

The Florida homeowners insurance crisis is especially tough on first-time buyers, but preparation keeps your deal alive.

Average Cost of Florida Homeowners Insurance

In 2025, the average Florida homeowners insurance premium will be about $2,850 per year—nearly 60% higher than the national average. Coastal counties like Miami-Dade and Monroe will see premiums above $5,000 annually.

For many families, these high costs make monthly mortgage payments unaffordable. That’s why working with experts during the Florida homeowners insurance crisis is so important.

Final Thoughts: Protecting Your Florida Dream

The Florida homeowners insurance crisis is real, but it doesn’t mean you must give up on homeownership. With the proper planning, insurer connections, and mortgage team, you can still protect your home and close on time.

At Gustan Cho Associates, we say yes when others say no. Call us at 800-900-8569, text us for a faster response, or email alex@gustancho.com to start your insurance and mortgage journey today. The team at Gustan Cho Associates is available 7 days a week, on evenings, weekends, and holidays.

Florida’s Insurance Crisis Doesn’t Have to Impact Your Home

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Frequently Asked Questions About Florida Homeowners Insurance Crisis:

Q: What is the Florida Homeowners Insurance Crisis?

A: The Florida homeowners insurance crisis means many insurance companies have left the state, rates have gone up, and it’s harder for families to find affordable coverage.

Q: Why are Insurance Rates so High in Florida?

A: Rates are high because of hurricanes, fraud, lawsuits, and fewer companies willing to stay in Florida. This has made the Florida homeowners insurance crisis even worse.

Q: How Does the Florida Homeowners Insurance Crisis Affect My Mortgage?

A: Lenders require proof of insurance before closing. If you can’t get coverage or it’s too expensive, your mortgage approval can fall apart.

Q: Can I Still Buy a Home During the Florida Homeowners Insurance Crisis?

A: Yes, you can. It may take more work, but with the right lender and insurance team, you can still get coverage and close on your loan.

Q: What are Some Ways I Can Cut Down on Insurance Costs During This Crisis?

A: You can raise deductibles, bundle auto and home insurance, add storm protection, and shop around for quotes. These steps can help lower costs during the Florida homeowners insurance crisis.

Q: What is Citizens Insurance, and Why do People Use it?

A: Citizens is the state-backed insurer in Florida. Many use it during the Florida homeowners insurance crisis because private companies won’t cover their area.

Q: Will I Need Flood Insurance, Too?

A: Yes. Regular homeowners insurance doesn’t cover floods. During the Florida homeowners insurance crisis, many buyers also needed a separate flood policy to satisfy lenders.

Q: Which Companies Still Write Policies in Florida?

A: Some still active companies include State Farm, Tower Hill, Universal Property & Casualty, and Citizens. However, choices are limited because of the Florida homeowners insurance crisis.

Q: What Happens if My Insurance Company Drops Me?

A: If you receive a cancellation notice, you must find another company immediately. Citizens Insurance is often the backup option during the Florida homeowners insurance crisis.

Q: How Can Gustan Cho Associates Help Me?

A: We guide borrowers through the Florida homeowners insurance crisis by connecting them with insurers, ensuring coverage meets lender rules, and helping them close on their homes.

This article about was updated on September 19th, 2025.