January 12, 2007
Homeowner Insurance - Shifting The Burden To The Florida Taxpayers
By Dana Joseph
In the ever changing debacle of homeowner insurance in Florida, comes yet another proposition being floated. Pay Now Or After The Big One? outlines the gamble that some legislators would like to take as a solution to the insurance crisis. Lawmakers are considering letting the Florida tax payers shoulder more of the burden if a catastrophic hurricane were to hit. This would be done via an increase in the state sales tax.Â
Rick Greene, owner of Southwest Insurance Associates of Sarasota, said reducing rates and capping exposure for carriers is a good approach, but many questions need to be answered.
The insurance industry seems to like these ideas, although for the Florida taxpayer it doesn’t sound like too good of a plan. If this measure is adopted, then even tourists to the State of Florida will wind up paying for damage, and I am not too certain there will be a lot of tourists if the “big one hits.”Â
It appears that lawmakers are interested in “just getting the rates to do down” rather than the long-term consequences. It reminds me of the person buying a home they cannot afford because they can get an interest only mortage and they can make the monthly payments. Sooner or later, it will catch up with you.  Â
I hope that the committees working on some solutions to the property tax issue are discussing their ideas with the homeowner insurance committees. Both groups are touting an increase in the state sales tax as an answer to their respective problems.Â
If you found this post helpful, you can get free updates by subscribing via RSS or by E-mail.Support Our Site: Use The Following Amazon Coupon Code
Topics: Homeowner Insurance, Property Taxes |
5 Responses to “Homeowner Insurance - Shifting The Burden To The Florida Taxpayers”
Comments
« Frugal Food Ideas That Are Fast and Inexpensive | Home | 5 Tips For 2007 Tax Planning »
March 24th, 2007 at 2:47 am
Ok, right now I am so angry I cannot see straight. This is my homeowners insurance horror story:
We have lived in the Florida panhandle for about 8 years now. We purchased 4.5 acres in the country, high and dry, and purchased a double wide manufactured home. It’s a very good one and was the top of the line 8 years ago, but it is still a double wide.
Our homeowners insurance for the first 6 years was approximately $700.00 per year. Not wonderfully low, but manageable. After Katrina, our homeowners insurance was CANCELED or NON-renewed. Uh helloooooooo, we have never made a claim. So, we found another insurance carrier, but the only way to get insured was to pay $2100.00 up THREE times what we had been paying. Now, what is fair about this? WE have made no claims, we, in the panhandle have been lucky and not had a direct hurricane hit, thank God. I feel for the Katrina victims more than you know, however, WE did not make any claims and our area was not hit. We do not live near the beach, we are 30 miles north of Panama City, we are so high and dry, our well had to be dug down 250 feet to get to the spring water.
We are 49 and 52 years old, (me and my husband), he is retired military. We had to borrow the money just to pay for homeowners insurance last year. We simply did not have $2300.00 laying around the house. PLUS to even be able to get insured, we had to get rid of our go-cart and our mini-bike. This is because the insurance company told us to get rid of them or they will not insure us. Supposedly because someone might ride on them on our property and we might get sued. Now lets see, WE are all of a sudden having to pay THREE times the rate just to be insured but then we are told what we are allowed to have on our own property. My goodness, we are grown-ups here, mature adults with no children living with us. How does an insurance agency have the right to tell us what to do, just so we can be screwed and have to pay out the butt just to be insured?
Last year, we were all very blessed and had a great and mild hurricane season, so we were hoping our rates would go down at least a little bit! But NO!, instead we have been canceled again. Now, after checking around we cannot find anyone to insure us except for the government backed insurance agency. Guess what though? The rates have gone UP now to $2300.00 AND they will not insure our outbuildings, nor the contents of our home, just the home itself. WHAT!!!!!????!!!! Ok, my husband and I have been married for 30 years and we have accumulated a lot of stuff. We have both had to work ourselves half to death to have what we do have. No one has ever given us anything, no goverment handouts, NOTHING!
One has to hate being in the middle class in this country. With this insurance issue if you are really poor and have nothing anyway, you do not need insurance and if you do lose what little you have, the goverment will supposedly step in and HAS from what I’ve seen in many cases. THose who were UNinsured, recieved many government benefits.
Those who are rich, of course, can afford to pay these outrageous insurance rates. But the majority of people who are in the middle class are just plain screwed! We have enough that it needs to be insured, yet we cannot afford the insurance rates. Well, with this latest development, we are now having to borrow the money again this year and had to put my husbands truck (which WAS paid off), up for collateral to get yet another loan just to pay homeowners insurance. I cannot even begin to describe how mad we are about this!
Next year, we hope to have enough equity built up in our home equity loan just so we can use it to pay for insurance. So, instead of being able to do any home improvements or repairs that may arise, we have to use it to pay for homeowners insurance. AGAIN, homeowners insurance that will only cover my house, not my three outbuildings with a LOT of money invested inside and out, NOT my furniture, clothing, appliances, computer, tv’s or anything else that we have worked ourselves half to death for.
I also do not understand something else. AOL had an article from a major publication about which states had the highest insurance rates. Texas came in number one and Florida was like 5 or 6. Then it went on to advise what those AVERAGE homeowners insurance rates were. I nearly passed out by reading that the average homeowners insurance rates in Florida are $929.00!! How on earth is it that WE are having to pay $2300.00 and NOT even have our contents or outbuildings covered? Our home is only going to be covered by what we owe which is $70,000 and the average home price in Florida is probably at least $200,000!!! WHY do we have to pay nearly three times the average Florida homeowners rate? We are older, but not senior citizens, we have NEVER made a homeowners insurance claim, we are not irresponsible people AND my husband served 26 years in the Navy defending his country.
Again, I ask WHY???????
Does anyone here know why? Does anyone here have any solutions? Does anyone know where to turn? Any help and advice would be greatly appreciated!
WolfLover
May 17th, 2007 at 5:33 am
I recently renewed my policy for my home in Collier county. I live 20 milles from coast and have never had a claim in 35 years. My policy doubled in cost this year with it being due May 28th. The company said they were not passing any savings to me because Charlies new state bill is effective after June 1 and that my 35 years of being a good customer didn’t count for anything.
I cancelled my policy and found another for 400 less. I could tell they were glad that I cancelled.
I think the future of insurnace and your good old company you been with for years thing is over. I think its just going to be a yearly struggle for insurance all they way up to where we cant afford it.
May 17th, 2007 at 3:22 pm
we are in the same position. We have a small 3 bed 1 bath home. built in 71. They doubled our insurance. They are telling us that the replacement cost is what makes it so high too, nevermind that we couldnt’ even sell our house even close to what they say the replacement cost it. so we are yet screwed again by insurance. we have only lived here for 4 years. we are most likely going to have to sell our home because we just can’t afford it with the insurance. we have been sick about it ever since we found out, it is all we can think about. wondering how we are even going to pay our bill next month because it went up so high. how can they get away with this?
July 23rd, 2007 at 5:37 pm
I think I know some reasons why the cost of homeowner’s insurance is so outrageous and why so many policies are being cancelled. Due to hurricane damage we had to have a new roof put on our home. Four months later while our screen room was being installed we learned that portions of our new roof consists of new shingles that are attached to badly rotted wood.
As a homeowner and taxpayer I find the knowledge I have gained from this ordeal to be very troubling. Apparently Florida contractors can easily get away with doing substandard work that does not comply with the Florida Building Code. I filed a complaint against the contractor with the State of Florida Department of Business and Professional Regulation (DBPR). They sent me a letter stating that the matter should be handled on the local level. The local Building Department has done nothing other than give me a letter indicating which portions of the Florida Building Code they actually enforce. The letter states that they rely on the contractor’s honesty and integrity. It seems like this lack of action and concern would only encourage this type of fraudulent activity.
I have also learned that although Florida statutes indicate that Building Inspectors must be licensed by the State of Florida there seems to be exceptions. The substandard work that was done on my home passed inspection based on the professional opinion of a plumber who works for the City Building Department rather than the opinion of a qualified, licensed Building Inspector.
Now I have learned that I must accept the financial responsibility to have my home repaired properly. That alone will cost approximately $10,000.00. If I want to take legal action against the contractor I must also pay for a home inspection. Then I will need to pay an attorney hundreds of dollars per hour and pay for court costs as well. I will also have to locate another roofer who will be willing to go to court with me as an expert witness and pay him to do so. Many people cannot afford to pay for the repairs so taking legal action against the contractor is not even an option. Therefore the negligent contractors are free to continue doing business in this manner.
I keep looking at this devastating financial disaster and wondering how this happened. We are hurricane victims and we had homeowner’s insurance. We checked out and hired a licensed contractor. The work underwent the mandatory inspections. So how did we end up in this situation? What happens to victims such as the elderly and disabled who do not have thousands of dollars to pay for all of this? What happened to the laws and government agencies that are supposed to protect Florida homeowners? It seems to me that our current laws and system only encourage this type of fraudulent activity and it obviously does contribute to the rising cost of homeowner’s insurance.
The current system clearly does not work in a manner that provides protection for the residents of Florida. Even more disturbing is the fact that none of our elected officials can tell me how this happened or what action they plan to take in an effort to make sure it doesn’t happen to anyone else.
As our lawmakers scratch their heads wondering what can be done about the rising cost of homeowner’s insurance I sit here thinking that portions of the solution are rather obvious. Fully enforce the Florida Building Code, use competent, qualified, licensed Building Inspectors and make the DBPR function in a manner that truly protects homeowners and their insurance companies instead of protecting negligent and incompetent contractors!
April 29th, 2008 at 1:15 pm
[…] Visit website: notmadeofmoney.com […]