ALIRT, a provider of insurance market research and analysis, recently released its annual review of Florida’s domestic property insurance market, highlighting the overall state of the market following tort reform.
According to ALIRT, this segment of Florida’s real estate market has shifted dramatically from a near-collapse state in 2022, when rampant litigation abuse, soaring loss costs and multiple insurance company bankruptcies dominated, to a revitalized environment that is now attracting new capital and new underwriting interest, aided by the state’s tort reform aimed at stabilizing the market.
The report noted that since the reform, 18 new or re-established insurance companies have entered or announced plans to enter the market, marking an industry-wide vote of confidence. ALIRT highlights that six insurance companies will begin underwriting homeowners insurance between 2024 and 2025 alone.
In addition to the influx of new market participants, the report points to two other indicators of the market’s health: the rapid decline in the number of Citizens Property Insurance Companies (the state’s insurer of last resort) over the past two years, and the significant improvement and stabilization of general insurers’ ALIRT scores.
The company also explores diversified ownership structures and business strategies among these operators, including the increasing popularity of reciprocal exchanges. The report further examines several key financial indicators that indicate a strengthening of the composites market position.
ALIRT concluded that the Florida homeowners insurance market is in its strongest position since the mid-2010s, showing broad-based improvements in revenue growth, profitability, surplus levels and capital inflows.
However, the company warned that this part of the market remains susceptible to sharp reversals. Substantial storm losses, volatility in global reinsurance pricing and ongoing regulatory and political pressure, including proposed legislation to revisit three-year-old market reforms, continue to be significant uncertainties affecting the future of Florida’s property insurance market. However, the market is currently going through a period of renewed stability and optimism.
