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Homeowners in Florida have begun 2015 with a small break in fees associated with real estate insurance. The Florida Office of Insurance Regulation effected the termination of a 1.3 percent assessment that has been used to pay off hurricane claims in years past. Bonds that were used to cover the cost of those claims were paid off 18 months ahead of schedule, according to a press release from the office. 

The bonds existed under the Florida Hurricane Catastrophe Fund, which was an assessment applied to all premiums on property and casualty insurance policies in the state. While it began at 1 percent in 2007, homeowners saw it increase to 1.3 percent in 2011. In total, the Cat Fund collected $2.9 billion through 2014 and was used to reimburse providers for damages that were disbursed as a result of hurricanes in 2004 and 2005. 

Moving forward, the assessment has been dropped to 0 percent for new and renewed policies starting in 2015. Outstanding policies from before that benchmark will still be assessed at previous rates, depending on which year the insurance was issued or renewed. 10 News in Tampa Bay reported that for one homeowner, the savings would only amount to about $17, though the assessment change might motivate policyholders to update their insurance policies. 

In a state with significant vulnerability to hurricanes, the measure was adopted to beef up the Cat Fund. While homeowners may only see marginal reductions to their annual insurance costs, the change is a positive step toward making policies in Florida more affordable. A decade ago, the prevalence of major hurricanes disrupted the market and set corrective measures into action to manage the financial toll. The office's announcement marks a resolution to one facet of that recovery.