Florida Homeowners WILL LOSE BIG in 2025 Unless You Do This!

Florida homeowners will lose their insurance because of this. How do I know? I just got this letter saying my policy could be canceled in three months. This isn't just a problem for the real estate market. This is a huge deal for anyone living in Florida. Not only have insurance companies been denying claims left and right for hurricane victims, now they're telling us, We don't. We're canceling your policy and you're on your own. So I wanted to know, how did this nightmare even start? Here's what I found. Back in 1992, Hurricane Andrew hit Florida and surrounding states and it caused $26.5 billion in damages and 65 people lost their lives. Now that led to insurance companies going bankrupt and a lot of them leaving the state of Florida. So Citizens Property Insurance Corporation was created in 2002. That's a state backed insurer for homeowners that are unable to find private coverage. So problem solved, right? Wrong. Back in 2019, the average annual insurance premium was $2,000. Not bad. But fast forward to 2024 and the average annual premium today in Florida is $10,996 a year. That's the absolute highest in the country compared to the national average of $1,700. Now since 2017, 11 insurance companies have just gone out of business and others have just stopped insuring Florida altogether due to the high risks associated with hurricanes. Now we just got hit with two major hurricanes, Helene and Milton, and they caused all kinds of damage leading to a surge in claims. And reports indicate that Citizens Insurance has denied claims by a lot of these people impacted by these hurricane storms. They're trying to transfer the responsibility onto FEMA and we all know how FEMA is handling this situation. There's also city permitting delays that are slowing down repair work and these permits are taking weeks, sometimes months instead of a 24 hour turnaround. So people are still in a bad way down here in Florida and you would think that the insurance you pay every year would be the one thing you can count on, but it's not. But the truth about Citizens Insurance is it was never set up to be the major insurer in Florida like it is now. It was initially created as a last resort for homeowners and today it insures 1.2 million policies. And the policies were structured to be higher cost policies to encourage people to find private insurance somewhere else. But the problem is there's not many other companies available. Now Citizens is saying it's had enough and it has to cancel thousands of policies and people need to go somewhere else to get their insurance. And I understand why they're doing this, but really the timing is horrible. So here's how it works. If a private insurance carrier offers you insurance at 20% or more than your Citizens policy, you do not have to accept that and you can stay with Citizens. Now if the policy they offer is 19% or more, you still don't have to accept it, but Citizens is going to drop you and you're on your own. The reason Citizens is trying to unload all these policies is because they're concerned about being able to pay out if another major storm hits in the future. It could put Citizens out of business. One of the major reasons this is such a big deal today is because of inflation. With the rising cost of labor and materials and the value of homes skyrocketing, a $200,000 policy 10 years ago could now be a $1.4 million policy today. Florida also accounts for 80% of the nation's insurance lawsuits driving up cost. And insurers cite financial strain from frequent storms and high claims. Insurance companies want to collect money and not pay out claims. That's the goal. In the insurance business, there's a term for it. It's called winning. So here's three things that Florida is doing right now to try and fix this issue. Number one, Florida lawmakers have passed reforms to reduce lawsuits and fraud. Number two, Governor DeSantis and the Florida legislature are calling for changes, but there are no quick fixes. Number three, they're focusing on stabilizing Citizens and attracting more insurers to the state of Florida. And it's happening slowly. One of the major reasons we're seeing all this damage is homes are old and they're not built to the current hurricane codes. I think the state should find ways to incentivize buyers to tear down old homes in flood zones and build them up to the new current hurricane codes. That's where the first floor is a garage and the living space starts about 14 feet up out of the flood zone. Maybe the state would allow them to finance the mortgage and the new construction at a 3% interest rate. I don't know. They got to try something. They also need to strengthen the current building codes to reduce storm damage. Houses in Florida need to be built out of concrete or block, period. They need metal truss roofs or concrete roofs at a minimum. Now the current building codes allow you to build a new home with the first floor being block and you can build stick or two by fours above that. I don't think that's a great idea and I'd love to see that changed as well. I think the whole structure should be built out of block or concrete. If a builder is building to the current hurricane building codes, they're really only building to the minimal amounts. Attracting more insurance companies to increase competition is a great idea and it's nice to see that that's actually starting to take shape. The cities also need to speed up the permitting process to allow homeowners to rebuild faster. Government moves at a snail's pace compared to private companies, so local mayors need to get on their building departments to get these permits through faster and help these people out. So why is this such a big deal? Insurance premiums are going through the roof and claims are getting denied left and right. Homeowners are getting stuck in a tough spot and it's putting Florida real estate on shaky ground. Houses are piling up on the market and nobody's buying because they're scared of what might be coming next. If this keeps up, it's a race to the bottom and our home values could tank. But here's why I'm not freaking out about it. This is still Florida and it's real estate in paradise and investors know it. They're waiting to scoop up properties at a discount. Out of state buyers and big companies like Blackstone are already making moves and they're buying up houses in Florida. Blackstone, for example, has plans to buy 15,000 homes in the Tampa Bay area over the next three years. They're targeting homes with at least three bedrooms, two baths and less than 20 years old and they're already buying heavy in Clearwater. Here's the deal. They know that this insurance problem is going to get fixed one day and when it does, they're going to be sitting on a goldmine and so will I. So be smart in this market, but don't sit on the sidelines forever. If you're thinking about buying a home in Florida, now's the time to start looking. Tons of people are holding off right now, but all it's going to take is for interest rates to drop a bit and the market will blow up again with buyers fighting over homes. These prices are too good to ignore right now. You don't want to wait until it's like 2022 again where people are throwing down $50,000 over asking just to get a shot at a house. That's a headache you don't need. Look for homes with newer roofs and ones that aren't in flood zone or evacuation zones. That'll help keep your insurance costs in check and always make sure you get a four point inspection before you buy. Insurance companies are going to ask for it anyway, so you might as well get ahead of the game. If the house passes, great, you're golden. If it doesn't, use the report to negotiate with the seller to get those repairs fixed. Either way, make your move while it's a buyer's market. The one thing I wish I would have done before moving here was check out all those hidden costs associated with living in Florida. Honestly, they caught me off guard, but that doesn't mean you have to get blindsided too. In this next video, I'll go over the hidden Florida expenses that left me broke. I'll see you there.