Before Hurricane Irma hit Florida last weekend, many warned about the potential for record storm surges, which did, in fact, flood large parts of Florida’s western coast and devastated the Florida Keys. But flooding is just one reason for the housing damage wrought by Irma. Wind is the other.
Irma’s unprecedented 350-mile width put every county in Florida on hurricane watch for the first time in the state’s history. Hurricane-force winds ended up hammering houses across the entire southern and central part of the Florida peninsula; the rest of the state was hit by sustained, tropical storm winds.
That wide geographic spread will test the resilience of Florida’s unique private homeowner insurance market. And it will also test the state government’s election-season resolve not to expand subsidized state homeowner insurance.
Will private homeowner insurers survive Irma’s wind damage claims?
Residential flooding damage is exclusively insured by the federal government. The National Flood Insurance Program mandates the purchase of flood insurance in designated high-risk zones. Wind damage, however, is covered by private homeowner insurance policies or by designated state or “residual” insurance programs. Buying such insurance is quasi-mandatory, since banks won’t issue mortgages unless a property is covered.
Florida has a …read more
Via:: Monkey Cage