What is it?
On February 14th, Ohio-based insurance-rating company Demotech Inc. announced that in March they plan to reduce the stability rating of many Florida insurance companies from A to B. This decision is based heavily on how AOB abuse has created what they call “an uncertain operating environment” in the state. This downgrade can directly affect the mortgages of thousands of Florida homeowners, since mortgages backed by Fannie Mae or Freddie Mac require A-rated property insurance, or else the mortgage could be in default. About 20 to 30 per cent of the Florida market could be affected.
What’s being done about it?
If you’re a Florida homeowner concerned about how AOB abuse might affect you or your mortgage, the best thing to do is to arm yourself with information. Contact your local and state Chamber of Commerce, or a Showcase agent if you think you might be at risk. If a contractor making repairs on your home tries to persuade you to assign benefits to them or a third party, contact your insurance company before agreeing to anything. Educating yourself and using local resources will help you avoid becoming an AOB abuse statistic.
If you would like to read more about how homeowners can avoid being put at risk for fraud, please check out our blog post Fraud Alert: Types of Real Estate Fraud and How To Avoid Them.
Our knowledgeable team is happy to share their vast experience regarding all aspects of home ownership. Contact us if you have any concerns and we will be happy to help!