South Floridians turn to alternative home insurance
With major insurers poised to shed more property insurance policies this year, Florida residents will be shopping for alternatives.
Two little-known options expected to become more popular are surplus-lines companies and self-insurance pools.
Surplus lines and condo self-insurance pools aren’t subject to Florida rate regulations, so they may be cheaper. Another perk is that they’re exempt from state fees insurers pass to policy holders. But there are risks. If a major storm hits, surplus-lines policy holders and condominium or homeowners’ groups that self-insure can’t tap the Florida Insurance Guaranty Association fund that helps pay claims when insurers fold.
“They’re extremely complex and not easily understood even among insurance experts,” Jeff Grady, president of the Florida Association of Insurance Agents, said of unregulated insurers. “People [considering the option] really need to do their homework or consult with someone who understands insurance.”