Progressive Reduces Home Insurance Business in Florida
By Julia Echikson October 5, 2023 9:46 pm
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Yet another home insurance company is reducing its presence in the Sunshine State. Progressive announced that it will not renew some home insurance policies in Florida beginning next May.
The move is expected to affect about 100,000 policyholders, WFLA reported. The Ohio-based insurer is preparing to phase out 47,000 DP3 policies, which are usually for second homes, and 53,000 policies for so-called “high-risk properties.”
“Florida property remains an important part of our Progressive Home business, and we have no plans to leave the state,” according to a company statement. “However, we have been working collaboratively with state officials and the Florida Office of Insurance Regulation to implement changes that allow us to rebalance our exposure while continuing to serve Florida homeowners.”
As part of an agreement, Loggerhead Reciprocal Interinsurance Exchange will offer replacement policies to those affected.
Progressive’s step back comes as competitors have gone bankrupt, pulled back from Florida — as Farmers Insurance did this July — or raised premiums, despite efforts by state lawmakers to backstop the insurance market.
Last year, Florida Gov. Ron DeSantis signed into law legislation that mostly amounted to an industry bailout, thanks to provisions to create a $1 billion taxpayer-backed reinsurance program for insurance companies, among other measures.
Still, the cost of home insurance in Florida averages $6,000 a year, while the national average stands at just $1,700 per year, according to the Insurance Information Institute.
Driving the higher costs are destructive storms, mostly notably Hurricane Ian, which made landfall in the Fort Myers area last year, and is set to become the third most expensive disaster-related recovery effort. Hurricane Idalia, which hit earlier this year, is not expected to cost billions.
Julia Echikson can be reached at jechikson@commercialobserver.com.
