The Business Journal recently had an interesting article about how the state’s reforms to Citizens Property Insurance Corp. will ultimately have a huge effect on those living on South Florida’s coasts.
For those of you who aren’t aware, Citizens Property Insurance Corp is a state-run insurer.
According to the recent legislation that the state government approved, protocol for Citizens Property has changed to help reduce enrollment, which officials say will make it less vulnerable during a storm.
This is sure to have a large impact on waterfront property owners all of South Florida!
What South Florida Home Owners Should Know About the Law Change
Under the recent change, residents will be limited to 10 percent annual premium hikes, although new enrollees would have to pass through a number of other insurers before choosing Citizens.
Experts are saying that because of this change, rates will increase overtime since homeowners would need to select private coverage within 15 percent of that offered by Citizens.
Eventually, more insurance providers will be attracted to the area, experts say.
As soon as the Citizens reform was passed, shares from the Fort Lauderdale-based Unviersity Insurance Holdings increased to its highest level in a year.
Universal Insurance Holdings is the largest private insurer in Florida.
Here’s how else the reform will affect circumstances in Florida: Some experts believe Citizens’ policy limit reductions will cause the maximum coverage to decrease from $2 million to $1 million, eventually falling to $700,000.
Some experts think the changes are coming at a bad time and may curb the housing market recovery in South Florida.
After all, investors may think twice if they’re forced to choose private insurance with higher premiums, experts say.
That could in turn call the housing market recovery to slow down or stop altogether.
What’s more, the reform forbids Citizens from covering new coastal construction after July 1, 2014. This may have a direct impact on such South Florida coastal communities.
Still, some experts say the changes to coastal construction coverage may actually end up benefiting the less expensive condominiums in Brickell and Downtown Miami.
South Florida Luxury Real Estate For Sale
What do you make of the recent legislative changes concerning Citizens Property Insurance Corp?
I am always happy to offer straight-forward advice and providing you with such useful home-selling resources as:
Until next time,
Scott
