$1600 per year on $100K for home replacement is cheap in FL. A more realistic number would be about $3000K per year for such a home. And Citizens had a 25% rate increas on Jan 1, plus another 55% increase in March. That means insurance for such a house would jump to $5800 per year. That's like saying there's a 6% risk of your house being wiped out every year, or your home would likely be replaced every 16 years. You would be paying almost double the principle on your mortgage in insurance costs. That is exploitation on the part of the insurance company.
If this is true, why doesn't someone with money, like Warren Buffet, come in an underwrite insurance for a couple thousand homes in the area? He could easily afford it, and the cash flow vs risk would be better than any money he can make any where else.
What you are telling me is that if I have a ten million dollars sitting around invested, I could come down and charge $4000 to insure the house, undercutting the insurer by so much nobody would refuse me. If I do that with 100 homes scattered throughout the state, then unless I'm remarkably unlucky, I could lose a home a year and still make a cool $300,000 a year on an "investment" of nothing.
Why not place an ad in the paper for 99 other people to form a limited partnership mutual company, which would insure all of your properties?
This is what is so maddening about the discussion. I'm guessing it would be impossible to do what I just said, probably because of STATE REGULATIONS. But if you COULD do what I just said, that would force the insurers to charge a fair price, for else you could find the better price.
It is regulation that stifles competition and makes prices unfair. Home insurance is just too easy a task to be overcharging double or triple unlesss there are hefty artificial barriers to entry.