After devastating 2022 hurricane season, AAA not renewing some insurance coverage insurance policies in Florida

ORLANDO, Fla. — AAA gained’t renew “a really small proportion” of householders and auto insurance coverage insurance policies in hurricane-wracked Florida, becoming a member of different insurers in limiting their publicity within the Sunshine State regardless of efforts by lawmakers to calm the risky insurance coverage market, the corporate mentioned Tuesday.

AAA mentioned in an announcement that it wasn’t leaving Florida, however that final yr’s devastating hurricane season had led to an “unprecedented” rise in reinsurance charges, making it extra pricey to function.

Officers with the corporate refused to say what number of insurance policies in Florida would not be renewed however mentioned that they had been “increased publicity” package deal insurance policies which bundle householders and auto insurance policies and had been underwritten by Auto Membership Insurance coverage Firm of Florida. An AAA spokesman would not clarify how the corporate outlined “increased publicity,” when requested.

“It is a determination we don’t take flippantly,” the AAA assertion mentioned. “We acknowledge that it is a troublesome time for these affected.”

The affected policyholders have already got been notified, they usually can apply for auto protection from sister provider, Auto Membership South Insurance coverage. AAA additionally mentioned it will proceed to put in writing different, new house and auto insurance policies, regardless of the choice to not renew some insurance policies.

Florida’s insurance coverage woes are leaving some householders like Lawrence Kolin within the lurch. His insurer wouldn’t renew a coverage for his stucco and brick, Spanish-tile-roofed house close to downtown Orlando. With 30 days left till his protection lapses, he can’t get one other insurance coverage firm to present him a quote.

“My home has survived 84 years of hurricane seasons,” Kolin, a mediator and trial lawyer in Orlando, mentioned Tuesday. “It’s simply an untenable state of affairs.”

Florida has struggled to keep up stability within the state insurance coverage market since 1992 when Hurricane Andrew flattened Homestead, worn out some insurance coverage carriers and left many remaining corporations fearful to put in writing or renew insurance policies in Florida. Dangers for carriers have additionally been rising as local weather change will increase the energy of hurricanes and the depth of rainstorms.

The choice by AAA comes every week after Farmers Insurance coverage mentioned it was discontinuing new protection of auto, house and umbrella insurance policies in Florida, becoming a member of an extended checklist of insurance coverage woes to hit the Sunshine State not too long ago.

Not less than six insurers went bancrupt in Florida final yr. On the finish of 2022, common annual property insurance coverage premiums had risen to greater than $4,200 in Florida, which is triple the nationwide common. About 12% of householders within the state didn’t have property insurance coverage, in contrast with the nationwide common of 5%, in keeping with the Insurance coverage Info Institute, a analysis group funded by the insurance coverage trade.

The Legislature and Florida Gov. Ron DeSantis have grappled with the problem every of the final two years, together with a particular session in December. A lot of the focus has been on shielding insurance coverage corporations from lawsuits and setting apart cash for re-insurance to assist shield insurers. Critics of DeSantis, who’s in search of the 2024 GOP presidential nomination, say he has centered an excessive amount of effort on divisive cultural points and never sufficient on making housing and insurance coverage extra reasonably priced.

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Observe Mike Schneider on Twitter at @MikeSchneiderAP