Insurance
The Insurance Situation
No longer writing new policies in Florida are Farmers, Progressive and AAA. But, State Farm, Travelers and Nationwide remain. Happily, in December of 2024, the Florida Chamber of Commerce’s Annual Insurance Summit reported signs of insurance market stabilization. Some factors are not weather related at all, and could be controlled.
The Insurance Information Institute believes costs increased after the Supreme Court in 2017 allowed attorneys 2.5x their normal billing rate when courts find for policyholders, increasing litigation in general. This has nothing to do with risks posed by weather and Florida now accounts for 79% of all insurance lawsuits filed! Another factor is that the remaining smaller insurers rely heavily on reinsurers who are retreating from Florida, which drives up costs. The types of insurance are described below:
Property Insurance
This generic term serves as an umbrella term for Renters, Homeowners, Condo (for unit owners), Landlord and Commercial insurances. Note that a “Standard Homeowners” policy is more comprehensive that a standalone Property policy.
Standard vs. Comprehensive Homeowners Insurance
Standard Home Owners Insurance (known as HO-3) covers everything regarding your house unless something is specifically excluded; e.g., normally flooding is not included. Comprehensive Home Owners Insurance (known as HO-5) also excludes flood insurance, but in addition to Property protection on a physical building and its contents, a comprehensive policy “packages” that with additional Liability coverage for injuries and suits, and Loss of Use paying for temporary housing if your home becomes unlivable. So the jargon used to describe the insurance is important to know.
Both are often referred to as “All-Risk” types of insurance. They will differ in how your belongings are covered. Standard policies specify the events (named perils) they cover, like fire and theft. A Comprehensive policy covers everything (even accidental damage) unless excluded or limited, for example coverage on jewelry and electronics. Another difference is a Standard policy will often depreciate the value of an item based on age, while a Comprehensive policy typically covers replacement cost. Finally with a standard policy you must prove the damage was caused by a covered event to get paid, while for comprehensive insurance the insurer must prove the damage is excluded in the policy to deny the claim.
Examples: If you drop a bucket of paint on an expensive rug or lose a wedding ring a Standard policy would likely not payout while a Comprehensive one would. The latter plan will cost 10-to-25% more.
What it Means for Me
You want a condo association to have property insurance on the structure of the building in the event of a fire, hurricane or other disaster. After-all, you can’t really rebuild just your condo unit without addressing the larger structure it lies within. This should be a Comprehensive plan to covers liability if the association is sued, should a painter fall off a ladder or a guest slip in the parking lot.
As the owner of a condo, you want Comprehensive Homeowners Insurance, as that protects you from liability from other owner’s actions or tenants, like that slip in the parking lot. Unless you have another home to move to, getting coverage for the motel you stay in after a disaster is also wise. While the condo association’s property plan would likely cover damaged insulation in the walls and replacing plywood subfloors, it will not cover the interior of your condo often described as “from the paint in.” So while a burst pipe and the wall or ceiling it ruined would be repaired by the condo insurance, the damage to your wall-to-wall carpet and tile, contents (furniture, clothes and electronics), HVAC system, kitchen appliances, lighting, artwork on the walls and tile floors would not be covered. This is where Homeowners Ins. comes in. There might be some overlap for covered the burst pipe in your condo (if determined part of your home) but that is a good thing.
Not all HOA fees pay for “Building Insurance” like Mentone Court does. Think of building insurance as a component of the more comprehensive home insurance, but it only covers repairs to the structure and pays if a pipe bursts causing water damage, or a tree breaks through a wall. Fire and wind (usually with a higher deductible) damage will also likely be covered. Flood damage is not covered, thus the need for separate flood insurance.
Flood Insurance
So if a condo’s HOA fee includes building and/or liability insurance coverage that can be a huge cost savings to you, and it would help justify a more expensive monthly HOA fee. For example, Mentone Court’s condo association has a policy with the Midvale Indemnity Company covering each 8-unit building for over $1,000,000 for liability.
Mentone also has building insurance that covers hurricane damage (with a 5% deductible). But it does not include flood insurance. So for any condo – not being in a moderate or high risk flood zone is important if you want to find and buy additional private flood insurance beyond the $250,000 maximum allowed with a NFIP plan (described below). Don’t buy a condo for more than $250k, at least on the first floor in a Special Flood Hazard Area (SFHA) zone A (high risk) or V (super-high surge risk) as private insurance will not likely even be available.
You can get NFIP insurance at the maximum $250k in zone X (low risk), and for higher but reasonable rates in zones B and C (moderate to high risk), but additional coverage will be costly for B and C. See the previous section that describes the flood zone ratings.
NOTE: Neither Building nor Home insurance will ever cover any damages due to external rising waters; i.e., flooding. An insurance adjuster’s investigation will determine if water damage was wind driven vs. flooding, with the latter not being covered.
Mentone does have building insurance that covers hurricane damage (with a 5% deductible). But it does not include flood insurance. So not being in a moderate or high risk flood zone is important, and it is critical if you want additional flood insurance as that affects the cost and even if such insurance is available at all.
Almost all residential flood policies are sold through the National Flood Insurance Program (NFIP) administered by FEMA, here’s some details. They subsidize about 50 insurers to keep them in the game. Private insurance in Florida is almost nonexistent, maybe 3000 policies are left in the state. Of course there is always Lloyd’s of London whose syndicates will compete to sell you insurance, as very high rates on the private market. That’s not an option for even the super wealthy, show self-insure by being able to tolerate the loss of more than $250k on a home.
Flood insurance benefits will kick in if water surges from the ground up, like from a heavy rainfall or an overflowing nearby lake or river. The maximum allowed for a NFIP plan is $250k on the building and $100k for contents, prices vary only slightly among the NFIP plans who choose to serve your area. Cost varies based on selecting a $1k deductible for each plan, to a maximum of $10k. NOTE: If fire or wind-driven rain comes in through your walls/windows or damages your roof and water enters through the ceiling that is not covered by flood insurance, but typically it is covered by home insurance. You need a mix.
Analysis:
Building insurance, provided by the condo association, is essential to cover wind and falling tree damage, flying objects, etc. is essential for any condo on any floor in Florida. Don’t buy a condo without seeing the association’s master insurance plan, and make sure it covers liability and your outdoor parking stalls. If you are above the first floor in a condo building, flood insurance is of much less or a worry. Still, a flood from a overfilled drain pipe might be determined as not due to wind, and you should consider carrying an NFIP plan on at least $25k–$50k if affordable (e.g. under $500 per year in zone X).
For any first floor condo, buy NFIP insurance at the maximum on the building of $250k and on the value of the contents up to the $100k max. It will cost more for locations other than zone X, but will be affordable as it is subsidized. Strongly consider additional private flood insurance, but realize it may not be affordable (or even available for SFHA zones A and V) in the future as risk worsens with climate heating. If you don’t believe in climate warming, see the section on Hurricanes. This isn’t about politics, it’s about insurance underwriters’ estimates of risk based on recent weather (not climate) history in just the last ten years.
Example: This writer’s local boat captain, who looked after Alto, had 8” of water come into her house during Hurricane Milton. Her NFIP flood insurance covered tearing up and replacing all floor tile, cutting the sheetrock back two feet from the floor and replacing the insulation and sheetrock and repairing wiring and studs where needed. She had put her furniture up on blocks before the storm hit, and pulled out her appliances to avoid trapping water under the kitchen cabinets. She received a check in a couple weeks from her NFIP plan for $75,000 based on their adjustment, but her costs using the tradesmen (I referred her to) came to about $40,000. You don’t have to suffer anxiety about buying property in Florida, if you think before you buy!
Strategy: For the condo you like, start by asking if your HOA fee covers Building insurance and for which components in your condo (remember the cover over your parking space). Ask the association for a copy (a PDF) of the Master Policy. Trick: drop the PDF into Google:Gemini and ask AI to review the policy whether it covers liability, flood and/or hurricane damage, and avoid hours of struggle reading it. When you open a PDF in Adobe Acrobat, it will ask if you want AI to analyze it, which worked until my questions became to complex and it wanted me to buy a subscription to continue. I just asked a free competitor (Gemini) and got answers in seconds to all this.
Next explore costs of adding homeowners insurance to cover interior parts of your condo that the Building policy doesn’t cover. At the least cover the cost of rugs, vinyl floor covering or tile, furniture and electronics, kitchen cabinets, appliances, possibly HVAC equipment if not elevated and your personal items.
If on the first floor take out an NFIP plan for the maximum flood insurance of $250k, as no condo is worth less in Sarasota. BTW, this is an argument to not buy the most expensive condo you can afford, as only $250k is typically covered unless you buy additional private flood insurance. This is doable in zone X, but may not be affordable in other flood zones.
What we did: Since our Mentone Court units’ liability and structure insurance is covered (for hurricane and fire) by the condo fees, we only had to think about flood and contents insurance. In a block and tile building should a flood reach us, we worry mostly about the tile flooring, appliances, kitchen cabinets, and the water heater and AC compressor at ground level. We took out a NFIP comprehensive policy to cover all-risk for contents and structure due to non-flood perils. As it was an NFIP subsidized plan also offered flood coverage of $75,000 and contents up to $25,000 for $678/year. We figured we could replace floors, cabinets, appliances and HVAC equipment for around $40,000 with our tradesmen, who had recently done that in a much larger house for our boat captain. Our second floor unit was just $568/year, but we skipped it and instead invested in adding heavy hurricane film to all windows, and installing a 12-foot wide cat. 5 hurricane rated Kevlar roll-down screen on the front of the porch. Our biggest concern is flying objects, which breaking a window can lead to wind and water infiltration destroying the unit. With our systems in place, that risk seems negligible (knock on wood).
BTW, our new solid kitchen cabinet boxes are plywood (not particle board which asks like a sponge when exposed to water. We had the lower cabinets installed on 1/8 nylon floor guides to circulate air under them if drying is needed. After a flood, if you act quick to avoid mold you can pull the appliances out and rent high power fans and turn the AC down and dry everything out (except particle board). You can push our island around on those glides too. Cool! Think ahead where you can.
Final Thoughts:
The websites for all 31 NFIP insurers in Florida are listed here. You can Google “best flood insurers in Florida” and go to their website. There are on-line home insurance comparators to get an idea of costs, but this Get a Quote link for homeowners and renters is to the actual NFIP website. It takes only a few minutes to give you a quote and it will then connect you with three insurance brokers instantly to get policies at that quoted price I have not found salesmen trying to upsell stuff, just upgrade the policy to a Standard homeowners plan (you don’t need liability) or a Comprehensive plan to pay for a motel, liability and less worry over claim rejection. See, now you’re an expert in Florida insurance!
HINT: Ask the broker about adding a rider for flooding due to clogged storm drains in your street. If an overwhelmed storm drain leads to flooding you unit, it may be deemed as not “rising water” related but rather due to negligence on the city’s part and the resulting damage might not be covered. This is rare, but you might as well ask.
Whether you look at Mentone Court or not, try to buy a condo in flood zone X as being above the flood plain is a huge relief. BTW, Google:Gemini AI estimates flood insurance for a first floor condo in the X-zone, like ours, to range from $500-$980 per year for the maximum coverage of $250k building and $100k contents, but that was overkill for us as explained above.
No longer writing new policies in Florida are Farmers, Progressive and AAA. But, State Farm, Travelers and Nationwide remain. Happily, in December of 2024, the Florida Chamber of Commerce’s Annual Insurance Summit reported signs of insurance market stabilization. Some factors are not weather related at all, and could be controlled.
The Insurance Information Institute believes costs increased after the Supreme Court in 2017 allowed attorneys 2.5x their normal billing rate when courts find for policyholders, increasing litigation in general. This has nothing to do with risks posed by weather and Florida now accounts for 79% of all insurance lawsuits filed! Another factor is that the remaining smaller insurers rely heavily on reinsurers who are retreating from Florida, which drives up costs. The types of insurance are described below:
Property Insurance
This generic term serves as an umbrella term for Renters, Homeowners, Condo (for unit owners), Landlord and Commercial insurances. Note that a “Standard Homeowners” policy is more comprehensive that a standalone Property policy.
Standard vs. Comprehensive Homeowners Insurance
Standard Home Owners Insurance (known as HO-3) covers everything regarding your house unless something is specifically excluded; e.g., normally flooding is not included. Comprehensive Home Owners Insurance (known as HO-5) also excludes flood insurance, but in addition to Property protection on a physical building and its contents, a comprehensive policy “packages” that with additional Liability coverage for injuries and suits, and Loss of Use paying for temporary housing if your home becomes unlivable. So the jargon used to describe the insurance is important to know.
Both are often referred to as “All-Risk” types of insurance. They will differ in how your belongings are covered. Standard policies specify the events (named perils) they cover, like fire and theft. A Comprehensive policy covers everything (even accidental damage) unless excluded or limited, for example coverage on jewelry and electronics. Another difference is a Standard policy will often depreciate the value of an item based on age, while a Comprehensive policy typically covers replacement cost. Finally with a standard policy you must prove the damage was caused by a covered event to get paid, while for comprehensive insurance the insurer must prove the damage is excluded in the policy to deny the claim.
Examples: If you drop a bucket of paint on an expensive rug or lose a wedding ring a Standard policy would likely not payout while a Comprehensive one would. The latter plan will cost 10-to-25% more.
What it Means for Me
You want a condo association to have property insurance on the structure of the building in the event of a fire, hurricane or other disaster. After-all, you can’t really rebuild just your condo unit without addressing the larger structure it lies within. This should be a Comprehensive plan to covers liability if the association is sued, should a painter fall off a ladder or a guest slip in the parking lot.
As the owner of a condo, you want Comprehensive Homeowners Insurance, as that protects you from liability from other owner’s actions or tenants, like that slip in the parking lot. Unless you have another home to move to, getting coverage for the motel you stay in after a disaster is also wise. While the condo association’s property plan would likely cover damaged insulation in the walls and replacing plywood subfloors, it will not cover the interior of your condo often described as “from the paint in.” So while a burst pipe and the wall or ceiling it ruined would be repaired by the condo insurance, the damage to your wall-to-wall carpet and tile, contents (furniture, clothes and electronics), HVAC system, kitchen appliances, lighting, artwork on the walls and tile floors would not be covered. This is where Homeowners Ins. comes in. There might be some overlap for covered the burst pipe in your condo (if determined part of your home) but that is a good thing.
Not all HOA fees pay for “Building Insurance” like Mentone Court does. Think of building insurance as a component of the more comprehensive home insurance, but it only covers repairs to the structure and pays if a pipe bursts causing water damage, or a tree breaks through a wall. Fire and wind (usually with a higher deductible) damage will also likely be covered. Flood damage is not covered, thus the need for separate flood insurance.
Flood Insurance
So if a condo’s HOA fee includes building and/or liability insurance coverage that can be a huge cost savings to you, and it would help justify a more expensive monthly HOA fee. For example, Mentone Court’s condo association has a policy with the Midvale Indemnity Company covering each 8-unit building for over $1,000,000 for liability.
Mentone also has building insurance that covers hurricane damage (with a 5% deductible). But it does not include flood insurance. So for any condo – not being in a moderate or high risk flood zone is important if you want to find and buy additional private flood insurance beyond the $250,000 maximum allowed with a NFIP plan (described below). Don’t buy a condo for more than $250k, at least on the first floor in a Special Flood Hazard Area (SFHA) zone A (high risk) or V (super-high surge risk) as private insurance will not likely even be available.
You can get NFIP insurance at the maximum $250k in zone X (low risk), and for higher but reasonable rates in zones B and C (moderate to high risk), but additional coverage will be costly for B and C. See the previous section that describes the flood zone ratings.
NOTE: Neither Building nor Home insurance will ever cover any damages due to external rising waters; i.e., flooding. An insurance adjuster’s investigation will determine if water damage was wind driven vs. flooding, with the latter not being covered.
Mentone does have building insurance that covers hurricane damage (with a 5% deductible). But it does not include flood insurance. So not being in a moderate or high risk flood zone is important, and it is critical if you want additional flood insurance as that affects the cost and even if such insurance is available at all.
Almost all residential flood policies are sold through the National Flood Insurance Program (NFIP) administered by FEMA, here’s some details. They subsidize about 50 insurers to keep them in the game. Private insurance in Florida is almost nonexistent, maybe 3000 policies are left in the state. Of course there is always Lloyd’s of London whose syndicates will compete to sell you insurance, as very high rates on the private market. That’s not an option for even the super wealthy, show self-insure by being able to tolerate the loss of more than $250k on a home.
Flood insurance benefits will kick in if water surges from the ground up, like from a heavy rainfall or an overflowing nearby lake or river. The maximum allowed for a NFIP plan is $250k on the building and $100k for contents, prices vary only slightly among the NFIP plans who choose to serve your area. Cost varies based on selecting a $1k deductible for each plan, to a maximum of $10k. NOTE: If fire or wind-driven rain comes in through your walls/windows or damages your roof and water enters through the ceiling that is not covered by flood insurance, but typically it is covered by home insurance. You need a mix.
Analysis:
Building insurance, provided by the condo association, is essential to cover wind and falling tree damage, flying objects, etc. is essential for any condo on any floor in Florida. Don’t buy a condo without seeing the association’s master insurance plan, and make sure it covers liability and your outdoor parking stalls. If you are above the first floor in a condo building, flood insurance is of much less or a worry. Still, a flood from a overfilled drain pipe might be determined as not due to wind, and you should consider carrying an NFIP plan on at least $25k–$50k if affordable (e.g. under $500 per year in zone X).
For any first floor condo, buy NFIP insurance at the maximum on the building of $250k and on the value of the contents up to the $100k max. It will cost more for locations other than zone X, but will be affordable as it is subsidized. Strongly consider additional private flood insurance, but realize it may not be affordable (or even available for SFHA zones A and V) in the future as risk worsens with climate heating. If you don’t believe in climate warming, see the section on Hurricanes. This isn’t about politics, it’s about insurance underwriters’ estimates of risk based on recent weather (not climate) history in just the last ten years.
Example: This writer’s local boat captain, who looked after Alto, had 8” of water come into her house during Hurricane Milton. Her NFIP flood insurance covered tearing up and replacing all floor tile, cutting the sheetrock back two feet from the floor and replacing the insulation and sheetrock and repairing wiring and studs where needed. She had put her furniture up on blocks before the storm hit, and pulled out her appliances to avoid trapping water under the kitchen cabinets. She received a check in a couple weeks from her NFIP plan for $75,000 based on their adjustment, but her costs using the tradesmen (I referred her to) came to about $40,000. You don’t have to suffer anxiety about buying property in Florida, if you think before you buy!
Strategy: For the condo you like, start by asking if your HOA fee covers Building insurance and for which components in your condo (remember the cover over your parking space). Ask the association for a copy (a PDF) of the Master Policy. Trick: drop the PDF into Google:Gemini and ask AI to review the policy whether it covers liability, flood and/or hurricane damage, and avoid hours of struggle reading it. When you open a PDF in Adobe Acrobat, it will ask if you want AI to analyze it, which worked until my questions became to complex and it wanted me to buy a subscription to continue. I just asked a free competitor (Gemini) and got answers in seconds to all this.
Next explore costs of adding homeowners insurance to cover interior parts of your condo that the Building policy doesn’t cover. At the least cover the cost of rugs, vinyl floor covering or tile, furniture and electronics, kitchen cabinets, appliances, possibly HVAC equipment if not elevated and your personal items.
If on the first floor take out an NFIP plan for the maximum flood insurance of $250k, as no condo is worth less in Sarasota. BTW, this is an argument to not buy the most expensive condo you can afford, as only $250k is typically covered unless you buy additional private flood insurance. This is doable in zone X, but may not be affordable in other flood zones.
What we did: Since our Mentone Court units’ liability and structure insurance is covered (for hurricane and fire) by the condo fees, we only had to think about flood and contents insurance. In a block and tile building should a flood reach us, we worry mostly about the tile flooring, appliances, kitchen cabinets, and the water heater and AC compressor at ground level. We took out a NFIP comprehensive policy to cover all-risk for contents and structure due to non-flood perils. As it was an NFIP subsidized plan also offered flood coverage of $75,000 and contents up to $25,000 for $678/year. We figured we could replace floors, cabinets, appliances and HVAC equipment for around $40,000 with our tradesmen, who had recently done that in a much larger house for our boat captain. Our second floor unit was just $568/year, but we skipped it and instead invested in adding heavy hurricane film to all windows, and installing a 12-foot wide cat. 5 hurricane rated Kevlar roll-down screen on the front of the porch. Our biggest concern is flying objects, which breaking a window can lead to wind and water infiltration destroying the unit. With our systems in place, that risk seems negligible (knock on wood).
BTW, our new solid kitchen cabinet boxes are plywood (not particle board which asks like a sponge when exposed to water. We had the lower cabinets installed on 1/8 nylon floor guides to circulate air under them if drying is needed. After a flood, if you act quick to avoid mold you can pull the appliances out and rent high power fans and turn the AC down and dry everything out (except particle board). You can push our island around on those glides too. Cool! Think ahead where you can.
Final Thoughts:
The websites for all 31 NFIP insurers in Florida are listed here. You can Google “best flood insurers in Florida” and go to their website. There are on-line home insurance comparators to get an idea of costs, but this Get a Quote link for homeowners and renters is to the actual NFIP website. It takes only a few minutes to give you a quote and it will then connect you with three insurance brokers instantly to get policies at that quoted price I have not found salesmen trying to upsell stuff, just upgrade the policy to a Standard homeowners plan (you don’t need liability) or a Comprehensive plan to pay for a motel, liability and less worry over claim rejection. See, now you’re an expert in Florida insurance!
HINT: Ask the broker about adding a rider for flooding due to clogged storm drains in your street. If an overwhelmed storm drain leads to flooding you unit, it may be deemed as not “rising water” related but rather due to negligence on the city’s part and the resulting damage might not be covered. This is rare, but you might as well ask.
Whether you look at Mentone Court or not, try to buy a condo in flood zone X as being above the flood plain is a huge relief. BTW, Google:Gemini AI estimates flood insurance for a first floor condo in the X-zone, like ours, to range from $500-$980 per year for the maximum coverage of $250k building and $100k contents, but that was overkill for us as explained above.
