Factors

• Tropical storms and hurricanes increase insurance claims and can lead to higher premiums.fishing pier damaged from hurricane image by itsallgood from Fotolia.com
  
  Factors such as sinkhole activity in the area, flood zone designation, distance from the ocean or major body of water, year of home construction, and type of dwelling can cause homeowner's insurance to be cost-prohibitive or unavailable. Insurance for some dwellings, such as mobile homes or RVs, is often non-existent.
  
  

Lack of Choice

• Because of factors such as high liability, insurance fraud, excessive losses, and issues between insurers and Florida state government, many insurance companies have ceased to write new homeowner policies in Florida. Others have canceled or allowed existing policies to expire, choosing to abandon the Florida market entirely. Insurance companies who have chosen to continue operating in Florida have either limited the number of new policies written each year, instituted rate increases or eliminated certain coverages. Combined, these issues limit the choices available to Florida homeowners.
  
  

Government Insurance

• Faced with the possibility that many Florida homeowners might be unable to find insurance, Florida created a state-funded "insurer of last resort:" Citizen's Property Insurance Corporation. This non-profit, tax-exempt entity provides homeowner's insurance to many Florida homeowners and is regulated by the state. In order to qualify for this program, a homeowner must have no insurance alternatives and must apply for coverage through Citizen's Insurance. This detail has forced many homeowners to purchase insurance offered by lower-quality insurers because it was available.
  
  

Considerations

• While homeowners can apply for insurance rate reductions or rebates for home improvements such as storm shutters, wind mitigation reinforcements or impact-resistant windows, such reductions are not guaranteed. The amount of reduction or rebate also varies among insurance companies.
  
  

Potential

• With an ever-increasing number of Florida homeowners faced with inadequate or low-quality insurance, the potential for catastrophic loss continues to rise. In the event of another hurricane season similar to 2004 or even a single major storm, insurance claims could force many insurers to default on their obligations. This would leave many homeowners with no resources to repair or rebuild damaged homes.