By Terry Witt – Spotlight Senior Reporter

                Williston’s insurance agent is estimating the city’s property rates could increase as much as 60 to 70 percent in the 2024 fiscal year largely because the entire state is considered prone to catastrophic weather events.

            The city won’t fare as badly as coastal cities and the property insurance rate numbers are preliminary for now, but Account Executive Lindsey Johannesen said costs are rising.

            She said insurance companies have sustained high losses and can’t recover their costs without going up on rates.

            “Basically, insurance costs in Florida on property are going up dramatically,” Johannesen told Williston City Council members Tuesday. “The rates are being driven by re-insurance.” She said re-insurance is what the insurance companies buy to resell to their customers.

            “The problem is that in the State of Florida, because we are the most catastrophic-prone area in the world, re-insurance is not getting a good return on investment. If we’re paying out $2 in claims and we take in $1 on the premium, that can only go on for so long. This is an overall-wide problem and it’s most acute in Florida,” Johannesen said.

            While property insurance rates are increasing, Johannesen said, on the positive side, Williston isn’t as catastrophe-prone as some of the state’s coastal cities. Williston is 40 miles from Cedar Key.

            “We do model out all of our cities for wind events, multiple hurricane levels, as well as flooding. That is a benefit to you all. You are a little more inland and you tend to fare a little bit better on that cat modeling,” Johannesen said.

            Johannsen said the city’s other insurance categories may see increases of just 5-15 percent. She believes the city’s overall insurance costs will rise 35 percent. The rates will be announced on Aug. 15.

            Council President Debra Jones said Williston is in a better position than some cities to recover the full value of buildings if the city sustains heavy damage in a catastrophic storm event. When the city’s buildings were appraised, she said Williston made the decision to insure the property at the higher value.

            “Some cities, when they had their buildings appraised, chose not to go up on the value of their property and stayed at the underinsured amount. I believe we did go up each time it was reassessed,” she said.

            The Florida League of Cities’ insurance division, the Florida Municipal Insurance Trust (FMIT), carries the city’s insurance policies. Johannesen is Williston’s insurance agent but she is also the west coast account executive for FMIT.

            Jones sits on the board of directors for FMIT. At the most recent meeting, she said Johannesen did a good job of explaining the anticipated insurance rate increases to the members. Other speakers also contributed information on the potential for much higher property insurance rates.

            “It is hard to swallow,” Jones said.

            She said she heard stories of how underinsured cities took a big hit after Hurricane Ian ravaged the Fort Myers Beach area in 2022. The storm caused $112 billion in damage, the costliest storm in history, and was blamed for 150 deaths, both direct and indirect.

            “I sat at the table in the board meeting with mayors and councilmen who were not up to date on their city’s property values and when they lost half their cities or all their utilities, they only got paid a percentage they were insured for, not the asset value,” Jones said. “When I left the meeting, I asked the same man who did the presentation if he knew what cities are 100 percent asset insured. He did not have the list with him but he assured me he would contact the city clerk. We were very happy to hear we were up there where we needed to be.”

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City of Williston Regular Meeting July 18, 2023; Posted July 21, 2023