MONTREAL — Canadian snowbirds who were lucky enough to escape property damage from hurricane Irma will still face higher costs as insurance providers jack up premiums and condo associations levy special assessments, say Florida insurance experts.
“We’re probably looking at across-the-board 15 to 20 per cent increase in property insurance costs over the next year,” says Brad Hubbard, the Tampa owner of an insurance agency and an engineering consulting firm specializing in flood risk.
He said the higher premiums could come from greater insurance losses and reinsurance companies determining there is a statistical increase in the risk that future storms will be more frequent and severe.
Hurricane Irma is expected to be one of the mostly costly storms in history with losses estimated at US$20 billion to US$65 billion, including up to US$50 billion in the U.S., according to risk modelling software company AIR Worldwide.
Additional insurance costs will be borne by all insured Florida homeowners, including the estimated 500,000 Canadians who own Florida properties.
Condo owners could also face special assessments if their building sustains heavy damage that isn’t fully covered by insurance or its policy has a high deductible.
“Your condo can be fine but at the end of the year you could receive a bill that says $3,500,” added Martin Rivard, an insurance broker in Boynton Beach originally from Shawinigan, Que.
The situation could be especially acute in areas like the Florida Keys, where 25 per cent of homes were destroyed by heavy winds and storm surge.
Rivard said he’s always amazed by homeowners — especially Canadians who purchased second residences when they were extremely cheap during the housing collapse — who decline to take out a policy because of the increased cost.
“I’m hoping that Irma was a wake-up call,” he said.