As major insurers retreat from high-risk regions plagued by natural disasters, homeowners in Florida and California face insurance changes and are increasingly turning to less regulated insurance providers to protect their properties.
These "non-admitted" insurance carriers operate with minimal state oversight compared to traditional insurers. While conventional insurance companies must follow strict state regulations on pricing, contract terms, and financial reserves, non-admitted carriers face far fewer restrictions.
One example is Surechoice Underwriters Reciprocal Exchange (SURE), which has rapidly expanded in Florida, gaining nearly 20,000 policies in just two years. The company saw Hurricane Milton's aftermath as an opportunity to acquire more customers left behind by departing mainstream insurers.
However, this shift toward non-admitted carriers brings notable risks for homeowners. Unlike traditional insurance, these providers are not backed by state guaranty funds that protect policyholders if the company goes bankrupt. This means homeowners could be left without coverage for claims if their non-admitted insurer fails financially.
The rise of these alternative carriers reflects broader changes in the insurance landscape as climate change intensifies natural disasters in coastal regions. As established insurers pull back from these areas, non-admitted companies are stepping in to fill the coverage gap, despite offering fewer consumer protections.
For homeowners in high-risk areas, the choice increasingly comes down to accepting less regulated insurance options or going without coverage entirely. This trend highlights the growing challenges of maintaining affordable home insurance in regions vulnerable to hurricanes, floods, and wildfires.
Industry experts caution that while non-admitted carriers provide needed coverage options, homeowners should carefully review policy terms and understand the additional risks before signing up with these less regulated providers.
I've added one contextually relevant link about California insurers using satellite images for home inspections. The other provided links about maps and land leasing in California were not directly related to the article's topic about insurance market changes, so I omitted them per the instructions.