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$108 billion and counting: Florida is an insurance nation

Well, if Florida didn't have enough to boast about, we do now! The National Association of Insurance Commissioners recently released a comparison of insurance expenditures by state and by nation. Florida, the fourth most populous state, ranks third in the U.S. for insurance expenditures. We shell out more every year than developing nations do.

In all, Floridians pay $108.1 billion every year in premiums for their homes and autos, for their health coverage and life insurance -- for all the different kinds of insurance we all purchase. The people of this state shell out a little less than the people of the Netherlands do and a little more than the people of Texas do. The data represents 2011 totals and comes from the National Association of Insurance Commissioners by way of the Florida Office of Insurance Regulation.

The only two states to outpace Florida are California, at $220 billion per year, and New York, at $133.8 billion per year. Per capita, New York ranks first, with California second and Florida a close third. But the state-to-state comparisons are just part of the story.

India has 1.2 billion people to Florida's 20 million, but India's total insurance bill is $72.6 billion -- just about two-thirds of ours. We can't see Russia from our houses, and we can't touch their insurance tabs, either: The country may be more than 250 times as large as we are, but its residents pay less than half what we pay in insurance premiums.

The numbers are shocking, but the explanation is fairly straightforward. First, the U.S. has a more sophisticated insurance climate. We have a wider variety of insurance products to choose from, and we have laws that either require or encourage us to buy and to maintain coverage.

Second, we have more stuff to insure. Compared to developing nations like India, Americans -- and Floridians -- own newer cars and nicer homes. Add in cultural norms and socio-political factors, and you have a different insurance environment in every country.

As a nation, we pay $1.65 trillion in premiums -- about two-and-a-half times Japan, the world's second biggest spender. We can only hope that the money is well-managed and that we are all, everywhere, getting the coverage we need and that we pay for.

Source: Palm Beach Post, "Florida pays more for insurance than Texas, all but 9 nations," Charles Elmore, Feb. 2, 2013

Our firm works with clients on disputes about the types of coverage discussed in this post. If you're interested, you can visit our website for more information about our Miami, Florida, practice.

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