FLORIDA INSURANCE RATES ARE JUST FINE IN BREVARD COUNTY FLORIDA

When it comes to homeowners insurance FLORIDA gets a lot of bad press. I frequently get calls from out-of-towners wanting to move or invest in Central Florida, but worry they can't get reasonable insurance to cover their investment. I've sold manufactured homes as well as older frame homes and have yet to see the buyer refused coverage. In fact, in the last year I've seen some quotes that were surprisingly low. Rather than me go on about it, let me show you an article from The Florida Association Of Realtors website today. New insurance companies are mentioned by name along with their phone numbers. Hopefully this will help quiet the perceived insurance issue in Florida. It's a bit wordy but worth the read:

Smaller insurers, more options

TAMPA, Fla. - Feb. 22, 2008 - As the big national insurance companies such as State Farm, Allstate and Nationwide continue to pull up stakes in Florida, smaller unheard-of companies have stepped up to fill some of the void.

They're writing new policies, lowering rates and giving homeowners an alternative to state-run Citizens Property Insurance Corp., Florida's insurer of last resort. In fact, after months of tremendous growth, Citizens, the state's largest property insurer, has about 9 percent fewer policyholders than last fall. Citizens' policy count has dropped from a high of 1.4 million in November to 1.274 million now, a loss of about 126,000 policies.

The reason: A handful of smaller Florida-based companies have taken thousands of homeowners policies out of Citizens. Last year, insurers removed about 248,000 policies from Citizens, up from nearly 68,000 in 2006. What's more, the new carriers have prevented hundreds, perhaps thousands, of Florida homeowners from joining Citizens in the first place.

"We are writing a lot of homes that would otherwise be in Citizens right now," said David Howard, chief executive of St. Petersburg-based Edison Insurance, a small but growing company. "The Florida domestics are picking up the slack. They're writing the majority of business right now."

Between January 2006 and September 2007, the industry wrote more policies than it dropped. During that time, nearly 4 million homeowners policies were dropped while 4.4 million new policies were written.

The smaller companies employ different strategies. Some take policies only from state-backed Citizens. Others prefer to compete in the traditional marketplace. One writes policies only for homes worth at least $1 million that meet current building codes.

"We have a tremendous appetite for business on the west coast of Florida," said Ross Buchmueller, CEO of Privilege Underwriters Reciprocal Exchange, a Fort Lauderdale-based insurer known as PURE, which specializes in large homes worth $1 million or more.

Also, the smaller companies have an advantage over the insurance giants. They're more flexible because they have fewer investors to answer to and can adapt to customers' needs more quickly. What's more, they're committed to one market: Florida.

American Integrity Insurance (1-888-359-5515)

American Integrity Insurance, a Tampa-based insurer with 105,000 policies, got all of its business from Citizens. All the takeouts were voluntary, an important element that should be preserved, said Bob Ritchie, the company's CEO.

It's important to be "a true consumer's choice," Ritchie said. "It allows companies like mine to compete on service and relationships. At the end of the day, people like to do business with people they like."

The company, established in September 2006, will begin selling coverage in the traditional voluntary market in April, Ritchie said.

"We are writing both older and newer homes," he said.

In Florida, a successful property insurer must acquire plenty of reinsurance, keep rates competitive and spread the risk, Ritchie said.

"When you look at our portfolio, it is optimally spread throughout the state," he said. "We're not betting the storm is not going to happen."

Edison Insurance (1-800-657-6618)

St. Petersburg-based Edison Insurance has about 24,000 policies and a network of about 500 agents. It hopes to add 8,000 more policies this year, said Howard, the CEO.

Edison, established in 2005, is writing policies on homes of all types. Most of its policies are in South Florida.

"Because the market has gotten so competitive, our sweet spot is much larger than it used to be," Howard said. "There's really not a lot of homes we wouldn't write. We write within 1,500 feet of tidal water."

Edison's portfolio doesn't include any takeouts from Citizens.

"The only time we would consider that is if the market gets too competitive," Howard said.

Edison cut its 2008 rates by more than 30 percent. Premiums for Edison's policyholders average about $1,800 a year, Howard said.

The new Florida-based insurers are picking up thousands of policyholders that were dropped by State Farm, Allstate and other insurance giants, Howard said.

"They're writing the majority of business right now," he said.

Most of the smaller companies, he said, are well-funded and have sufficient reinsurance, backup coverage for insurance companies. Edison, he said, has enough coverage to pay for damage created by multiple storms.

"You got to make sure you have a very strong reinsurance program that protects the surplus of the company so you can be there to deliver when the storm hits," Howard said.

PURE (1-888-813-7873)

PURE provides coverage to a specific market. The homes must be worth $1 million or more and built to standards that equal or exceed building codes.

"A quarter of what we do is beachfront," said Buchmueller, the company's CEO. "Our business is extremely selective. The criteria to gain entry is very narrow."

The member-owned insurer has about 2,000 members and 3,500 policies, including auto policies. Buchmueller expects the company to double in size by year's end.

In addition to its selective coverage, PURE is unique in that its members contribute 10 percent of their premium to the company's cash surplus each year.

"We do not resemble in any way any other company that you could speak to," Buchmueller said. "If we broke even, we would still grow surplus by 10 percent a year."

Also, PURE limits its membership to 425 members per county, a policy that helps keep risk and exposure reasonable, he said.

PURE's growth is poised to soar next year. That's because, beginning in December, state law requires state-backed Citizens to drop customers with homes worth $1 million or more.

"It's almost $20 billion of insured values," Buchmueller said. "All of this business is going to find its way into the private market, and we think we're well-positioned to take large chunks of that."

American Strategic Insurance (1-866-274-8765)

American Strategic Insurance of St. Petersburg was established 10 years ago and has 260,000 policyholders, up from less than 200,000 in 2005.

The company has lowered its rates about 24 percent, on average, and is writing new policies. But the company doesn't want to get much bigger, citing the escalating cost of private reinsurance.

However, American Strategic CEO John Auer said his company is working with investors in hopes of licensing a new Florida-based insurer.

"We don't want to grow ASI substantially bigger, but we will find other companies that do want to grow the insurance business in Florida," Auer said.

Auer attributed the company's lower rates to a combination of reduced reinsurance costs and "good trends in both losses and expenses." Last year, the state expanded the Hurricane Catastrophe Fund by $12 billion, which allowed companies to buy more reinsurance at a lower rate than the private market.

American Strategic's business doesn't include any takeouts from Citizens.

"We've tried to win business through giving good service," Auer said. "We try to assign a rate to every risk. If the rate is low enough, we get it."

As a series of hurricanes struck the state in 2004 and 2005, many insurers stopped writing new policies. American Strategic, however, continued to grow.

"We never closed," Auer said. "We've grown every year."

Copyright © 2008 Tampa Tribune, Fla., Russell Ray. Distributed by McClatchy-Tribune Information Services.

Gail MacMillan Broker-Realtor®
Home Sweet Home Florida Realty, Inc.
At Home With Diversity (AHWD)
Certified Residential Specialist (CRS)
e-PRO Internet Certified (e-PRO)
Graduate Realtor Institute (GRI)
Relocation Specialist
Titusville, Florida
Cell: 321.544.6808

www.HomeSweetHomeFlorida.com great website - check it out - pass it on