The Anna Maria Island Sun Newspaper

Vol. 11 No. 10 - December 8, 2010


Weathering the insurance storm

The 2010 hurricane season may be behind us, but the insurance storm is just starting, especially if your homeowner’s policy is with Citizens Property Insurance Corp.

Effective Jan. 1, the three year freeze on Citizen’s rates will be lifted and anyone who is currently covered by a Citizens policy can expect an increase in next year’s premium. Although there is an annual 10 percent cap on individual policies built in to any increases Citizens can levy, this percentage can vary based on a variety of criteria.

For example, the anticipated average rate increase is 5.4 percent; however, this does not apply to high risk coastal areas. It also doesn’t apply to condominium associations that can plan on at least 10.2 percent. These averages also do not include a special assessment to be included in all policies starting in 2011. In addition, rates for individual homeowners, as well as condominium associations could be adjusted up or down based on new code requirements or changes to the property. You can also expect increases from Citizens during the next several years in order for it to meet its actuarial requirements.

None of this should come as a surprise to anyone who lives in Florida, especially in coastal areas, but what may surprise you is what Florida Tax Watch, an independent, nonpartisan research institute, thinks. In April, just before this year’s hurricane season was due to kick off, Tax Watch called Citizens Insurance “a high stakes gamble that may be one major hurricane hit away from depending upon Federal relief or facing financial crisis.”

It went on to say that the state’s focus on rate affordability has meant that the state hasn’t collected enough money from consumers to responsibly fund claims from a major hurricane. Artificially low rates have the added problem of discouraging homeowners to invest in hurricane proofing their homes.

The Wall Street Journal called Florida’s insurance market a laboratory of experiments to keep insurance affordable. One of those experiments was to encourage private sector start-up insurance firms, known as takeout firms because they literally take policies from the state run pool. The program was attractive because these firms can get an immediate book of business with no marketing expenses, plus the possibility of low-cost loans from the state. Although some of these new firms have survived and are viewed as successful by the state, their ability to pay claims is still questionable should a big storm hit the state.

There is, however, an additional layer of protection since private insurers are required by Florida state insurance regulators to carry reinsurance to supplement their hurricane claims. Reinsurers are specialty insurers who take on some responsibility for paying the claims of the primary insurer.

If Florida is an insurance laboratory, then so are all the other coastal states in the country. The difference is that Florida has a very long and susceptible coastline. Not to mention that, according to the Wall Street Journal, Florida’s insured coastal exposure increased 27 percent between 2004 and 2007, exasperating the problem.

So while you may be done with the heavy lifting of storing the storm shutters away, starting in January your checkbook will be doing the heavy lifting. Living in paradise has its price.

Real Estate Transactions
Closed sales between Aug. 2 and Oct. 9, 2010

Anna Maria

721 North Shore Single family $1,100,000
512 Bayview Place Single family 800,000
216 Palm Ave. Single family 699,000
104 Maple Ave. Single family 667,500
309 S. Bay Blvd. Single family 425,000
780 Jacaranda Rd. Duplex 357,500
216 Archer Way Single family 332,500
204 Archer Way Single family 300,000
333 Tarpon St. Lot 300,000

Bradenton Beach

500 Bay Dr. S. Single family $965,200
2317 Ave. C #300 Condo 315,000
1325 Gulf Drive N. #165Condo 300,000
1325 Gulf Drive N. #166Condo 300,000
1325 Gulf Drive N. #164Condo 285,000
1325 Gulf Drive N. #161Condo 285,000
1325 Gulf Drive N. #264Condo 280,500
501 Gulf Drive N. #103Condo 240,000
1325 Gulf Drive N. #163Condo 239,800
501 Gulf Drive N. #305Condo 227,000
2211 Ave. C Single family 220,000
2311 Canasta Drive Single family 165,000
2412 Gulf Drive. N. #125Condo 160,000
2412 Gulf Drive N. #224Condo 155,000
2412 Gulf Drive N. #225Condo 155,000
1603 Gulf Drive N. #18Condo 150,000
1603 Gulf Drive N. #19Condo 150,000
117 Seventh St. N. #9 Condo 150,000
1603 Gulf Drive N. #33Condo 109,000
107 Sixth St. S. Single family 100,000
2503 Gulf Drive N. #302Condo 100,000
1603 Gulf Drive N. #34Condo 70,000


12909 42nd Terr. W. Single family $1,025,000
11900 Cortez Rd. W. RV resort
#10, #17, #28, #45 Multi-units 619,700
4224 Marina Ct. Condo 525,000
3860 Mariners Way #413Condo 274,900
12329 Baypointe Terr. Lot 140,000

Holmes Beach

528 72nd St. Single family $1,450,000
3212 Gulf Drive Single family 1,300,000
616 Hampshire Lane Single family 775,000
3009 Ave. F Duplex 763,500
403 80th St. Condo 595,000
203 76th St. Condo 584,500
525 74th St. Single family 550,000
612 North Point Drive Single family 525,000
303 61st St. #A Condo 510,000
209 69st St. Duplex 480,000
6200 Flotilla Drive #273 Condo 480,000
227 85th St. Single family 440,000
517 70th St. Single family 416,500
203 82 St. Condo 400,000
519 77th St. Single family 400,000
405 N. Harbor Drive Single family 400,000
614 Concord Lane Single family 399,900
506 74 St. Single family 390,000
405 74 St. Condo 375,000
3706 Gulf Drive. Single family 370,000
6250 Holmes Blvd. #70 Condo 355,000
6200 Flotilla Drive #274 Condo 365,000
322 64 St. Condo 350,000
207 55 St. Single family 305,000
4104 6 Ave. Condo 285,200
609 Emerald Lane Single family 285,000
2903 Ave. B Duplex 278,000
3703 5 Ave. #3 Condo 270,000
309 58 St. Duplex 270,000
3207 6 Ave. Single family 260,000
3803 East Bay Drive #2 Condo 260,000
6919 Holmes Blvd. Half duplex 250,000
2805 Gulf Drive Single family 249,000
3702 Sixth Ave. #4 Condo 230,000
504 Key Royale Drive Single family 223,000
2705 Ave. C Single family 200,900
2710 Ave. C Single family 160,000

Source: Manatee County Property Appraiser’s Office

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