Based on the legislation that Governor Crist signed, the answer is “it depends”.  The homeowner insurance situation here in Florida is very complex, and the legislation that is going into effect is as complex.  Savings will depend on the following factors:

1.  Who the homeowner insurance is currently with and where the property is located.  Coastal properties who have seen their rates rise the most, will most likely see some relief, although it remains to be seen just how much.  I do not think that majority of people are going to be seeing a 40% reduction. 

2.  If you reside inland and your property is not insured through Citizen’s Insurance, your rate may only drop by 7% (if at all).

On the other hand, I can foresee the situation where homeowner insurance rates are going to increase uniformly around the state for those who have private insurance (not Citizen’s) due to the fact that all Florida property owners are on the hook to pay for any deficits in Citizen’s.  If we have another bad hurricane season, then we’ll wind up getting more assessments to pay for it.  Assessments were already included in last year’s homeowner insurance premiums under private insurers and will be in the coming year as well.  Even our auto insurance contains an additional 1% assessment this year for the Florida Hurricane Catastrophe Fund. 

 

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The Carnival of Personal Finance #85 is up on Five Cent Nickel.  There were a lot of really good entries today.  Here are my top picks:

I consider myself a frugal person.  It is my hobby to see how much I can stretch a dollar.  I really enjoyed this post on frugal versus cheap, over at the Stubborn Capitalist.  I like the easy-to-read chart which compares the two words, and provides examples of each. 

That’s A Lot of Money by Blunt Money was a good read as well.  We’ve also run the Quicken reports for several years’ worth of information and been surprised by how much we’d spent on a given category.   

Our Personal Finance State Of The Union Address by MoneySmartLife.  It is a great idea to complete an overview of your financial situation, both in terms of where you are currently and what your financial goals are.  Looks they are doing well!

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We just received the premium notice for our auto insurance policy.  We read all the line item amounts which detail the coverages and limits and the corresponding price.  Pretty much the same prices as last year for the liability coverage, no fault, comprehensive, collision and uninsured motor vehicle premiums.  However, we found this little entry underneath the premium total:

Plus FHCF Assessment - $3.49

In the notes section of the bill, it states that “your policy has increased 1% due to the Florida Hurricane Catastrophe Fund Assessment.”

After a little bit of research, come to find out that in June 2006 the Florida State Board of Regulation (who oversees the FHCF) directed the Office of Insurance Regulation to levy an emergency assessment on all property and casualty business in the State of Florida.  This assessment is applied to all policies issued or renewed after January 1, 2007.   This assessment was deemed necessary because the Florida Hurricane Catastrophe Fund was depleted of nearly all of the $6 billion in reserves it had built up from 1993 following the 2004 and 2005 hurricane seasons. 

If you’ve been keeping up with my posts about the homeowner insurance problem, then you’ll know that we are also paying an assessment to subsidize Citizen’s Property Insurance (the state run insurer of last resort).  Looks like there is going to be a lot more of these assessments coming, especially after the bill that Governor Crist signed last week.

 

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