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Best's Commentary: Troubled Florida Property Market Participants Under Immense Pressure.

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ENPNewswire-May 3, 2022--Best's Commentary: Troubled Florida Property Market Participants Under Immense Pressure

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Release date- 02052022 - Elevated reinsurance costs, coupled with higher loss and litigation costs, have challenged Florida property insurers' surplus levels and hindered balance sheet strength, leading many to rethink risk appetites, according to a new AM Best commentary.

The Best's Commentary, titled, 'Troubled Florida Property Market Participants Under Immense Pressure,' notes that insurers' ability to purchase the same level of reinsurance protection as in years past has been limited, and as a result, entities have refined risk accumulations and targeted non-renewals to minimize their reinsurance needs. Although these exposure initiatives are intended to improve overall enterprise risk management, the efficacy and appropriateness of risk mitigation strategies are yet to be fully determined. Nonetheless, 'Florida property insurers may find full placement of their catastrophe reinsurance programs ahead of the upcoming renewal season a challenge,' said Chris Draghi, associate director, AM Best.

Insurance industry leaders in Florida have been warning that the current environment for those still offering personal property coverage is untenable, given the greater frequency of secondary perils (e.g., severe thunderstorms, wind and hail), higher reinsurance pricing, escalating litigation costs and building codes/laws that have been flouted by parties looking...

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