Climate change will affect South Florida property insurance rates
MIAMI - More South Floridians homeowners find themselves stuck in a financial bind, paying for a home insurance policy that every year is on the rise.
Add to this, a report released on Wednesday stating that climate change could cause some areas to be uninsurable.
"I think there's going to be some migration to higher grounds because of climate change," said Nicholas Nathanso, echoing what some homeowners are contemplating in the Coconut Grove area.
He said home insurance has increased substantially in this neighborhood of the city of Miami.
Nathanso is aware of a study by First Street Foundation, a nonprofit that analyzes climate risk, that warns that the national real estate market "has not adequately priced the cost of climate into its valuation." The research has alarming implications for homeowners especially those living in Florida, California, and Louisiana - who according to the study - will be facing sharply higher insurance costs because of increased damage from extreme weather that experts attribute in part to climate change.
"It's a conversation my parents have multiple times, the insurance keeps going up, this is unaffordable," said Alessandro Caferrata, who lives in southwest Miami Dade.
He said the cost of insurance will end up driving his parents to move back to South America. His father is retired and on a fixed income, his mother has said it may be time to sell.
"Are my parents still going to live here, am I going to have an affordable place for me to live in?" said Caferrata.
CBS News analyzed the data which found the cities in South Florida most at risk for wind damage now and in the future are Miami, Ft. Lauderdale, and Hollywood, where one hundred percent of homes are at risk for high insurance premiums or losing coverage altogether.
Meanwhile, Nathanson said more people will choose self-insuring before an insurance company drops them.
"Self-insuring would be taking the $10,000 that you pay on homeowners insurance and putting it in a bank account. Then if you ever need to use those funds for whatever damage that you face, you have them," said Nathanson.
"I would say literally in the last three to four years, pretty much everybody's rate has at least doubled," said David Feather, an insurance agent at Great Florida Insurance of Coral Springs.
Feather said he does not foresee rates dropping anytime soon and now with the recent study about climate change, the hope is that more carriers come to Florida.
"What advice do you have for people who feel cornered and do not know what to do about this?" asked Ivan Taylor.
"We search for options for our clients, the days of you being with the same carrier for the next five or ten years that's gone, you have to shop around," said Feather.
Basically, when renewing do not be stuck with the same insurance company and you may get a better deal.
As far as opting out of home insurance, keep in mind the house must be paid off, those who still have a mortgage must have homeowner's insurance and, according to Feather, make sure you have the savings in case of emergency, having an insurance policy is always better.