The 2017 hurricane, which made landfall in the Florida Keys as a Category 4 storm before moving up the coast, didn’t cause a particularly great amount of damage. But it was the first in a series of storms, culminating in Hurricane Ian last October, that broke the model insurers had relied on: One bad year of claims, followed by a few quiet years to build back their reserves.
Since Irma, almost every year has been bad.
Private insurers began to struggle to pay their claims; some went out of business. Those that survived increased their rates significantly.
More people have left the private market for Citizens, which recently became the state’s largest insurance provider, according to Michael Peltier, a spokesman. But Citizens won’t cover homes with a replacement cost of more than $700,000, or $1 million in Miami-Dade County and the Florida Keys.
That leaves those homeowners with no choice but private coverage — and in parts of the state, that coverage is getting harder to find, Mr. Peltier said.
‘Just not enough wealth’
Florida, despite its challenges, has an important advantage: A steady influx of residents who remain, for now, willing and able to pay the rising cost of living there. In Louisiana, the rising cost of insurance has become, for some communities, a threat to their existence.
Like Florida after Andrew, Louisiana’s insurance market started to buckle after insurers began leaving following Hurricane Katrina in 2005. Then, starting with Hurricane Laura in 2020, a series of storms pummeled the state. Nine insurance companies failed; people began rushing into the state’s own version of Florida’s Citizens plan.
The state’s insurance market “is in crisis,” Louisiana’s insurance commissioner, James J. Donelon, said in an interview.