Florida’s personal property insurance market reported a significant recovery in 2024, posting its first underwriting profit after eight consecutive years of losses, according to a recent AM Best report.
The sector also recorded a substantial increase in pre-tax operating income, reflecting a notable improvement in financial performance.
The AM Best Market Segment Report, titled “Florida’s Property Insurance Market Showing Stabilisation Following Volatility and Sharp Premium Increases,” indicates that conditions in Florida’s property and casualty market are beginning to ease.
AM Best attributes this shift to growing competition, new market participants, stabilising premiums, and enhanced profitability.
This progress follows a lengthy period characterised by steep premium increases, constrained market capacity, and the rapid growth of Citizens Property Insurance Corporation—the state’s insurer of last resort.
AM Best credits key legislative reforms enacted in 2022 for playing a critical role in this rebound by improving the legal climate and addressing ongoing litigation challenges that had significantly impacted insurer results.
“Florida’s legislative reforms acted as a material tailwind for longstanding participants but also improved the environment to attract new entrants, effectively increasing capacity,” said Josie Novak, Senior Financial Analyst, AM Best.
“Additionally, the retreat of certain carriers—whether through reduced market participation or the suspension of new business—has created space for new companies to establish a foothold, further reshaping the competitive landscape.”
According to AM Best, legislative momentum continued in 2024 with the passage of a law allowing excess and surplus (E&S) lines insurers to provide coverage on seasonal homes, provided the insurers hold an AM Best rating of A- (Excellent) or higher and the homes are not covered by homestead exemptions. AM Best also points to early developments in the 2025 legislative session aimed at further easing access to E&S coverage for agents and consumers.
AM Best’s analysis focuses on a composite of 45 Florida-based personal property insurers that predominantly underwrite policies within the state.
This composite excludes companies affiliated with national carriers, Citizens Property Insurance Corporation, and insurers that have become financially impaired or merged recently to ensure accurate back-year comparisons.
According to AM Best data, active Florida property insurers—excluding Citizens and insolvent companies—reported a combined ratio of 93.1 in 2024, resulting in an underwriting gain of $206.7 million. This marks a sharp turnaround from a $174.4 million loss in 2023.
Pre-tax operating income increased substantially to $492.3 million, compared to a near breakeven result the previous year.
AM Best highlights that many of these insurers maintain substantial exposure relative to their premiums, with a direct premiums written-to-surplus ratio of 3.2 times compared to the US personal property composite average of 1.7 times.
The report also underscores Florida insurers’ high reliance on reinsurance, with ceded reinsurance leverage reaching 519.4% in 2024, far exceeding the 62.2% average for the US personal property composite. AM Best attributes these elevated figures to Florida’s unique vulnerability to catastrophic weather events and the greater direct risk assumed by specialist insurers.
This aligns with recent comments from Randy Fuller, Managing Director at Guy Carpenter, during the AM Best webinar, who noted that despite natural catastrophe events like California wildfires and Hurricane Milton, reinsurer appetite in Florida remains strong, with June 1 renewal activity progressing smoothly.
In conclusion, according to AM Best, a combination of legislative reforms, increased competition, and market adjustments are contributing to a more stable personal property insurance market in Florida following years of challenges.
“Looking ahead to midyear renewals, the balance of power appears to be shifting toward primary carriers,” added Chris Draghi, Director, AM Best.
“Given that loss activity has been more moderate in recent years and profitability has stabilised, Florida composite companies are now in a better position to manage risk accumulation and potentially negotiate more favourable terms with reinsurers.”
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