Monday, January 22, 2024






        So you think California has a serious property insurance crisis, with one company (State Farm) getting a 20 percent increase just as 2023 ended and others demanding even higher increases as some threaten to halt new policy sales in the state?


        As big as this crisis is, it does not compare with what’s going on in other states like Florida and North Carolina, where Republican-dominated legislatures may soon be forced to take measures the GOP has long called “socialistic.”


        Take Florida, whose Republican governor and former presidential hopeful Ron DeSantis loves to seize on every difficulty that arises in California, blaming everything from homelessness to high electric rates on Democratic dominance of state government.


        Florida already has a state-owned and -run insurance company called Citizen Property Insurance, which functions much like California’s Fair Plan. These agencies are funded largely by extra-high premiums paid by homeowners who for a variety of reasons can’t get policies from private companies.


        In California, most of the problems are confined to discrete areas the insurance companies deem subject to wildfires, either because they’ve already had some or because their foliage, climate and terrain makes them vulnerable to everything from a stray match to arsonists to negligence by electric companies.


        But in Florida, where the biggest waves of claims stem from hurricanes, there are no discrete boundaries, as hurricanes have hit almost all parts of the state.


        Home insurance costs there have risen hugely without a law like California’s 1988 Proposition 103 to restrain them. The cost of home insurance in the Sunshine State lately saw the average Florida homeowner paying more than $6,000 in 2023 and more increases on the horizon. That was an increase of more than 102 percent over the last three years.


        It doesn’t quite make up for the difference in home prices between California and Florida, but it does make Florida real estate more expensive than prices and rents make it appear.


        Enter “socialism.” Fully 15 insurance companies have pulled out of Florida in recent years and homeowners therefore suffer problems getting coverage. So the GOP-led Legislature is considering a huge increase in the maximum value of homes that can be covered by Citizen Property. The limit is now $1 million in assessed value, but lawmakers are considering upping that by half, to $1.5 million. That would leave very few Florida homes ineligible.


        DeSantis suggests making up for all this with decreases in property taxes, which are much higher than California’s because Florida lacks limits like those in this state’s 1978 Proposition 13.


        Republican legislators previously killed expansions of Citizen Property due to the “socialism” tag, but two GOPers are lead sponsors of the current expansion plan.


        Things are not quite so extreme in North Carolina, but homeowners are about to be hit almost as hard there as in Florida and much harder than in California. Insurance companies have not yet left North Carolina en masse, but several now seek increases between 42 and 99 percent in annual premiums. Increases could be even higher in the hurricane-prone eastern areas of that state.


        These levels of proposed increase would arouse huge protests in California, where the Consumer Watchdog advocacy group – whose founder Harvey Rosenfield wrote Proposition 103 – is now working to cut State Farm’s 20 percent rate hike, which seems paltry compared to what’s happening elsewhere.


        It’s one case of a serious California crisis with far worse counterparts elsewhere.


        Yes, California has weather-related disasters, but when they happen in Texas and Florida, they can be even more devastating than ours. What’s more, insurance companies have had it easier here since they leveraged their losses from the 1994 Northridge earthquake to end their obligation to write quake insurance. Instead, the state-run California Earthquake Authority has lucked out for almost 30 years, taking in large premiums from property owners without experiencing any truly massive temblors since Northridge in 1994.


        That’s allowed its reserves to pile up more than anyone could have expected back in the 1990s.


        It’s all just another example of why moving away from California doesn’t necessarily lead to the problem-free existence many emigrants expect in other states.



    Email Thomas Elias at His book, "The Burzynski Breakthrough: The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For more Elias columns, visit

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