Wildfires will change the face of homeowners insurance.
That was the message from Jeffrey Aal, a local insurance adjuster.
“AAA is probably going to stop writing in elevated areas,” he said. “Safeco is the largest single insurance company in the world, they will shift customers to a non-preferred company ... the insurers will pull out ... state-run risk pools could take their place.”
Aal is concerned Arizona could become the next Florida.
Florida has the most unique homeowner insurance businesses in the country. Two different markets evolved as hurricanes hit year after year.
The first is Citizens Property Insurance (CPI) run by the state. Homeowners turn to CPI when they cannot find private homeowners insurance. CPI is backed by taxes to keep the company afloat.
The other insurance companies in Florida do not have a national presence. As smaller companies they do not have the money the larger insurance companies do.
“It is real nominal coverage for a real high price,” said Aal.
A recent review of Florida residents by Clearsurance, indicates residents end up in more lawsuits over claims than other states.
Florida residents also complain more about their insurance rates.
Digging deeper, Clearsurance discovered what lay at the heart of Floridians’ issues — a lack of communication.
“Our data shows that some of these lower scores for insurance companies may be attributed to misunderstandings between the insurance company and the policyholder over what is covered,” wrote Clearsurance on its website.
Aal would agree.
He suggests Payson residents regularly check their homeowners policy to make sure they have the coverage.
“People will buy a house and their insurance policy will renew and renew and they will never look at it,” he said. “(Mortgage companies) don’t send out the notification to (insurance companies) when customers are in the process of moving.”