The Florida Hurricane Catastrophe Fund (FHCF)1 is a state fund created in November 1993, during a special legislative session after Hurricane Andrew. The purpose of the FHCF is to protect and advance the state’s interest in maintaining insurance capacity in Florida by providing reimbursements to private insurers for a portion of their catastrophic hurricane losses. The money in the fund has grown over the past ten years because Florida hasn’t been hit by a hurricane since Wilma in 2005.

On July 21, 2014, the Florida Office of Insurance Regulation (“OIR”) announced that it has terminated a 1.3 percent assessment on most property insurance policies used to pay off past hurricane claims. This is 18 months ahead of schedule (the original end date was July 1, 2016) due to an early payoff of the bonds used to pay the claims. The assessment will be discontinued on policies renewed or issued on or after January 1, 2015. This is good news for Florida policyholders.

However, the assessment will continue to apply to the direct written premium on all related transactions including, but not limited to, endorsements, policy cancellations, and audit premiums related to policies issued or renewed prior to January 1, 2015 at the applicable percentage below:

  • Policies issued or renewed on or after January 1, 2015: emergency assessment is zero percent;
  • Policies issued or renewed January 1, 2011 – December 31, 2014: emergency assessment is 1.3 percent;
  • Policies issued or renewed January 1, 2007 – December 31, 2011: emergency assessment is one percent; and
  • Policies issued or renewed prior to January 1, 2007: emergency assessment is zero percent.

You can read more about the “Hurricane Tax” at http://www.floir.com/Sections/PandC/Assessments.aspx.

1 Fla. Stat. 215.555 (6)(b).