September 28, 2022, Hurricane Ian went through the state of Florida, leaving a trail of destruction and causing billions of dollars in damages. The impact of the hurricane was felt, not only by those directly affected by the storm but also by the state’s insurance market. The market saw significant changes in the wake of the disaster. In this article, we’ll examine Hurricane Ian’s impact on the Florida insurance market, focusing on the insurers who have gone insolvent, those who have reduced capacity and the resulting tighter underwriting guidelines.

One of the most significant impacts of Hurricane Ian on the Florida insurance market was the number of insurers who went insolvent following the storm. The high number of claims made after the hurricane and with the sheer scale of the damage caused, put immense pressure on insurers’ finances. As a result, several insurers were forced to declare bankruptcy, leaving policyholders without the protection they had in place.\

In addition to the insurers who went insolvent, many others reduced their capacity after Hurricane Ian. This meant they could no longer offer the same level of coverage to policyholders as they had before the storm. Insurers reduced their capacity by lowering their policy limits or increasing their deductibles, which meant that policyholders were left to bear more of the financial burden of future claims.

Another impact of Hurricane Ian on the Florida insurance market was the implementation of tighter underwriting guidelines. Insurance companies became more cautious in their underwriting practices and were more likely to reject high-risk applicants. This meant that some homeowners could not obtain the coverage they needed, leaving them vulnerable to future natural disasters. This continues to be the case for residents on barrier islands struggling to find wind and hurricane coverage along with excess flood protection. The state’s insurer cannot facilitate coverage to many residents due to the value of their home exceeding their guideline allowance.

The effects of Hurricane Ian were not limited to the insurance market. The storm also significantly impacted the state’s economy, with many businesses forced to close due to damage caused by the hurricane. The resulting loss of jobs and revenue put further pressure on the insurance market as policyholders struggled financially and to pay their premiums.

Despite the challenges facing the insurance market, some insurers managed to weather the storm and emerge relatively unscathed. These insurers could do so by having robust risk management strategies in place, including effective underwriting practices and risk mitigation measures. Despite some insurers’ success, Hurricane Ian’s impact on the Florida insurance market was significant and long-lasting. The state’s insurance market continues to face challenges, with many policyholders struggling to find affordable coverage or being forced to accept policies with reduced coverage.

Hurricane Ian significantly impacted the Florida insurance market and the challenges facing the insurance market continue to be felt by policyholders and the state’s economy. As such, it is important for insurers to continue to focus on risk management strategies as policymakers work to ensure that Floridians have access to affordable and comprehensive insurance coverage.

Corey Walker

Personal Lines Sales Leader