More Than a Retirement Center and an Exporter of Oranges

The U.S. Census Bureau’s 2000 census estimated the population of the State of Florida at 15.9 million. About 80 percent of the adult residents had graduated from high school and about 22 percent had earned a bachelor’s degree. The city of Miami comprised 362,470 of the state’s population.

From an employment perspective, the primary industries in Florida are outlined in the chart below.

From a property/casualty insurance perspective, Florida accounted for $27.1 million of direct written premium. Countrywide as of Sept. 30, 2003, the aggregate is $313.7 million of P/C insurance written. Florida calendar-year 2002 loss ratio of 61.1 percent was slightly below the countrywide year to date Sept. 30, 2003 loss ratio of 62.3 percent. It was interesting to note that Florida’s homeowners loss ratio for calendar year 2002 was 38.7 percent compared to the countrywide average at Sept. 30, 2003, of 61.8 percent. Homeowners’ insurance premium comprised 12.6 percent of the P/C premium written in Florida. Homeowners premium comprised 10.7 percent of the premium written countrywide.

The Florida economy is more robust than we might assume. The employed civilian population comprises nearly one-half of Florida’s population. It is distributed as displayed in the chart below.

Given the anticipated growth in the number of jobs located in Florida and the diversification of the Florida economy, I would expect the growth rate of Florida’s P/C marketplace, as measured by direct premium written, to approximate the growth rate in states of comparable population and economic diversification.

Joseph L. Petrelli is president and founder of Demotech Inc. (www.demotech.com), a Columbus, Ohio-based financial analysis and actuarial services firm. Petrelli is a member of the Casualty Actuarial Society, American Academy of Actuaries and the Conference of Actuaries in Public Practice.

Topics Florida Property Casualty