A Helpful Florida Property Insurance Q & A

Make no mistake about it, property insurance has become a major issue for all Florida real estate owners. Kathy Bushouse has been the South Florida Sun-Sentinel expert on the subject since June 2004, right before Charley became the first of eight hurricanes to hit Florida in under two years. She recently answered readers’ inquires about Florida insurance in a Q&A session for the newspaper.

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Q: Where can I buy homeowners insurance at a fair price — under $3,000 per year?

A: That depends on a number of factors — where you live, what kind of home you have, how old your home is. Right now, there aren’t a lot of Florida property insurance companies willing to issue new policies in South Florida, and most people are seeing their bills skyrocket. You may want to check with an agent, however, to see what he or she can do for you.

Q: I live in a small (348-unit) condominium community in Boynton Beach. Our insurer will not renew our policy as 4/25/06. Our agent says our only option is to place our insurance with Citizens, which will raise our premium from $260,000 to $437,000. The community is 18 years old and has never made a claim under casualty coverage. Hurricane damage to buildings has been negligible. The Department of Business & Professional Regulation has assured me there is no State Statute requiring a condo association to carry casualty insurance. I have recommended to our Board that we do not carry such coverage, and that we continue to assess owners an amount equal to the $437,000 premium and escrow the money in a “Casualty Fund Account.” Your comments are appreciated.

A: I talked to the Department of Financial Services about your case, and they replied that while there is no law requiring a condo association to carry insurance on the building, it may well be a legal condition of any Florida home loan covering the condo building. So you need to check to see if there’s any kind of mortgage and proceed from there.

Q: I can’t afford insurance. I am 63 and retired. My house is paid off and I live in Boca Raton. What can I do?

A: You don’t have to have insurance if your house is paid off. However, you will have to pay for any repairs yourself if you have any kind of damage to your house that insurance would otherwise cover.

Q: I had personal property damage to my home due to Hurricane Wilma. Two roofing companies advise necessity of a new roof. My insurance company has allowed $3,900 for repairs, and has issued a check for other sustained damage. If I process this check, does that negate my ongoing claim for a new roof?

A: State insurance officials say that cashing the check shouldn’t affect other claims.

Q: Should I increase my homeowner’s insurance policy since my house has more than doubled in value and I’m still paying insurance on the buying price of $275,000. It’s now worth about $575,000. What should I do? My insurance is now $2,100 a year.

A: Your insurance covers what it would cost to replace your house, and does not take into account your land value. The Florida Department of Financial Services recommends getting an insurance checkup once a year, as appreciation or home improvements can increase the replacement cost of your home and its contents. Make sure you have enough insurance to protect the structure and your personal possessions.