Tom Fitzgerald, President, Retail, World Insurance Group

In an interview with Invest:, Tom Fitzgerald, president of retail at World Insurance Group, discussed the company’s growth, challenges, and innovations in the insurance industry, particularly in South Florida. He highlighted the region’s unique market dynamics, including the impact of natural catastrophes like hurricanes and the evolving demand for insurance solutions. Fitzgerald emphasized the importance of balancing technology with personalized service, stating, “Innovation is definitely coming.” He also pointed to advancements like Neptune’s flood insurance platform, which simplifies enrollment and offers replacement cost coverage, as examples of how technology is reshaping the industry.

What are some recent achievements of World Insurance Group in South Florida?

We enjoy working in Florida. We’ve made a fair number of acquisitions across the state, with a significant concentration in the South Florida corridor, specifically Miami, West Palm Beach, and areas slightly south of Miami. From our perspective, business is challenging in Miami. Insurance is difficult to place for many environmental reasons. At the end of the day, we like the Florida market, albeit the market is in a bit of turmoil — or perhaps better said, ever-evolving.

We continue to grow our platform. As we think about Florida broadly, it is a great place for us to plant flags and grow our operations in the state materially. It’s not lost on many that population hubs like Fort Lauderdale and Miami create tremendous opportunities for us.

How has demand for insurance solutions evolved in recent years, and what key trends are shaping client needs?

Florida is subject to natural catastrophes, specifically hurricanes. While this is not a discussion about climate change, the strength and power of these hurricanes significantly impact states like Florida. As a result, insurance companies have lost a tremendous amount of money, prompting the state to step in. Citizens Property Insurance provides options to insurers in Florida, and new capacity has entered the market. Rates have continued to rise, attracting capital, but losses remain substantial.

Coupled with personal line losses in places like California, the market faces significant challenges. The provision for wind and flood insurance in Florida is impacted by the overall performance of personal lines insurance across the U.S. Most clients cannot continually pay more, even as home values rise and mortgage requirements mandate insurance. Options include increased deductibles — traditional homes that once had a $2,000 deductible may now have $5,000, while coastal homes may face even higher deductibles.

Innovation in the insurance space has emerged, particularly in how people buy insurance. Parametric triggers, for example, provide coverage if a hurricane reaches a specific category, such as Category 4, regardless of actual damage. However, insurance is a very personal decision, often discussed at the kitchen table, where people understand their coverage. Innovations face slow adoption because when a roof is missing, policyholders expect the insurance company to replace it. As the industry grapples with increasingly significant claims and catastrophes, innovation remains a critical focus.

How are businesses adjusting their strategies to the current economic landscape?

Rates continue to rise, impacting both personal and commercial insurance. On the personal side, auto and home insurance are particularly challenging. Hurricane Ian alone caused $5.9 billion in physical damage in auto losses as it crossed Florida. When hurricanes occur, people often leave the state, but their assets remain exposed. This has led to continued rate increases, forcing individuals to make difficult decisions. Deductibles have risen significantly — insurers now offer property damage deductibles as high as $50,000, depending on the home’s size and value, a level previously unseen.

Insurers are also making decisions about the types of coverage they purchase. Wind coverage, for instance, is optional unless required by a mortgage lender. Flood insurance is another critical consideration, as many of the largest losses from recent hurricanes have been flood-related, with water damaging homes and vehicles. Deciding whether to purchase flood, wind, or general property insurance is a complex process for both personal and commercial policyholders.

These decisions become even more complicated during a claim. Determining the cause of damage — whether from wind, flood, or wind-driven rain — can be challenging. Counseling clients on how their insurance programs work and helping them mitigate costs is crucial. Having a trusted advisor to navigate the different insurance types and find the right match is essential, as insurance is deeply personal. This personal aspect becomes even more pronounced during a claim, as individuals rely on their coverage to recover from significant losses.

How is your firm balancing the use of technology with the high-touch, personalized client service that remains crucial in the industry?

When we think about the use of technology, there’s been a fair amount of money invested in what is called insurtech. The goal is to bring technology to what is generally a pretty stagnant industry — insurance. There are tremendous complexities associated with going online, such as the 50-state licensing challenge. Operating in 50 states means dealing with 50 state insurance commissioners. Just because you’re licensed in one state doesn’t mean you can operate in another, like Florida. Navigating these requirements is expensive, but innovation is coming.

One interesting example is Neptune, a company that has taken flood insurance online. They’ve introduced two innovative features. First, they require very little information to secure a quotation. The more details you provide, like elevation or content value, the more precise the coverage can be. Second, they’ve innovated around coverage itself. Unlike the National Flood Insurance Program (NFIP), which offers actual cash value (depreciated value), Neptune provides replacement cost coverage. This means they cover the cost to replace your roof or other assets, not just their depreciated value.

Neptune has simplified the enrollment process and created a unique product that has been incredibly successful. This kind of innovation is transforming how people buy and experience insurance.