The South Florida Sun-Sentinel reports today that Nationwide Insurance Company will no longer offer new homeowner policies to Floridians. Nationwide is the eleventh in a long line of insurance companies that are bailing out on Florida homeowners in the wake of last year's hurricanes.
Company spokesman Joe Case says "Even with rate increases, you have other pieces of the puzzle that are always changing [in the insurance market]. That demands a continuing evaluation of our business strategy."
As a Florida resident, may I say: What a load of crap.
Florida hurricanes are not exactly unheard of events. The Sunshine State has gotten pummeled for longer than scientists have been tracking storms so this "piece of the puzzle" has never "changed". If Nationwide chose to overlook or ignore the potential for repeated hurricane strikes in one season, that is their problem, not ours. Insurance companies have been content to take our money for years and we have been willing to pay for all the extra riders they insist upon: wind, flood, hurricane, etc. Now that Florida presents a risk to their bottom line, these companies are out the door faster than you can say "Category Four."
The departure of these companies from the homeowners market means residents will now be forced into the hands of smaller insurance companies known for their sky-high rates. Many private companies would be unable to absorb the financial impact of a hurricane season similar to last year's so insurance coverage becomes a very shaky situation for everyone concerned. Homeowners pay top dollar for coverage and then lose sleep wondering if they'll be reimbursed in the event of a loss. Small companies take these payments and then lose sleep worrying if they can cover the bills in the event of widespread hurricane damage. Meanwhile, companies like Nationwide simply pick up their toys and go home after years of promising they're "on our side."