Last Updated on September 29, 2020 by Andrew Lee
Owning a home gives you pride, joy, and satisfaction. However, it also gives you numerous responsibilities. And because you want to keep it as pristine as possible for you to continue enjoying a high level of livability, you should prepare yourself for anything that can possibly impact the level of comfort it gives and its overall quality.
This is where Florida homeowners insurance comes into play. With a properly and sufficiently insured house, you can keep extremely expensive property repair/replacement costs at bay.
Average premiums for homeowners and renters insurance in Florida
The National Association of Insurance Commissioners (NAIC) recently released the results of its study regarding the average homeowners and renters insurance premiums in the country and per state. According to the association, the national median is $1,096.
Homeowners paid an average of $2,115 making Florida the 1st state with the highest insurance premiums
Renters, on the other hand, had a median expenditure of $208 making the state the 11th place in the same ranking
The financial resource group ValuePenguin also reported that the monthly homeowners insurance premiums in the state amount to $165.91.
This means that between Florida and the national average, there is a 1.93% difference.
Coverage categories in the event of a loss
Another crucial must-know fact about the insurance of your home is its set of coverage categories. Standard policies in the State of Florida usually have four key categories. Coverage A covers “Dwellings,” Coverage B covers “Other Structures,” Coverage C covers “Personal Property,” and Coverage D covers Loss of Use/Additional Living Expenses. Insurance companies also offer other coverage types, such as liability and medical payments.
Coverage D, or the Additional Living Expense, takes effect when you find yourself in a situation wherein you can’t live in your home for a certain amount of time. In this case, this part of your policy will allow you to live in a rental unit temporarily, while also providing you with resources for food, gas, and mileage.
Key Facts and Market Trends in Florida: NAIC, in a separate, but similar study, released information as to this particular state’s key facts and market trends. The organization’s experts found that there are 444 domestic insurers in FL. Including the licensed foreign companies though, this number goes up to 2,066.
Insurance company settlements: How long Floridians have to wait
Although your insurance company is there to help you with paying for the costs associated with loss of or damage to property, this doesn’t mean you can expect them to settle with you in a matter of days. This is particularly true for major damages or losses. In typical situations, the waiting time for the completion of repairs, rebuilding, or replacements is around 18 to 24 months, as the United Policyholders reported.
Rules of Florida on cash value, replacement cost, and depreciation
As complex as it may be, you should still do your best in understanding even just the basic terminologies most commonly used in the homeowners insurance market. This’ll help you set realistic expectations in the event of property damage/loss.
A critical area you should arm yourself with the knowledge of is the process followed by insurers in determining a settlement amount. They use three variables in computing for this. To arrive at the “Actual Cash Value,” the amount that they will spend for the settlement, they subtract the Depreciation Value (percentage that takes into consideration the item’s state, condition, and age) from the Replacement Cost.
When something major hits your home (and its contents), and you don’t carry Florida homeowners insurance, it can cause a major dent in your finances. So rather than risking it, be proactive and have your property insured.