Own a Florida Residence -- Protect it AND Your Other Assets

Face it: whether you’re moving to Florida for a year or for the rest of your life, you want to be able to enjoy the things you’ve worked so hard for while you’re here. Luckily, Florida is one of the best states in the country when it comes to keeping your assets safe – be it from creditors or the weather.

Protecting Your Home

Your home is one of the greatest assets you will ever own. Not only is it a large investment, it’s full of your most cherished possessions and memories. There are numerous options available in the state to keep your Florida residence safe from harm.

Homeowner’s Insurance

Though Florida does not require that one own homeowner’s insurance, it is a good idea to obtain it. Homeowner’s Insurance covers costs associated with repairing or rebuilding your home and replacing your personal possessions if they’re lost due to theft, fire or other disaster. In short, coverage could save your family millions of dollars, and lots of stress, should an unexpected disaster occur.

If you have a mortgage, the lender will require you to obtain full insurance coverage on the structure, including flood insurance (if you are in a flood zone), fire, liability, windstorm, etc. Your city or county may also require liability coverage if you own things like swimming pools or certain types of pets. Liability insurance covers injuries to other people or damage to their property for which you are responsible. This type of coverage is built in to the general types of policies listed above.

Condo Insurance

If your Florida residence is a condo, you’re in luck. Florida requires that condo associations provide a minimum coverage to collective property, meaning that at least some part of your home is always protected even if you don’t have a personal policy in place. (Coverage can vary widely, so contact your association president for full details of your association’s coverage.)

Still, because condo insurance is limited, you may still opt to purchase personal insurance of your own. For those areas not covered in the association policy, you should consider purchasing Condominium Interior Insurance, which covers things like your wallpaper, trim, built-in bookcases, cabinets, fixtures, carpets and more.

High-risk Coverage

We all know how hard it is to get health insurance coverage if one has a pre-existing condition. The same goes for homeowner’s insurance for high-risk areas prone to flood, hurricanes and other natural disasters. To help, Florida established the Citizens Property Tax Corporation in 2002 to ensure that property insurance is available to all Floridians, regardless of risk zone. Citizens is a not-for-profit, tax-exempt corporation, whose public purpose is to provide policyholders with affordable property insurance protection. For more information, visit the company’s website at https://www.citizensfla.com.

Other Types of Protection

Protecting your Florida residence from weather and other unexpected incidents is just one part of the equation. It’s also important that you keep your home safe from creditors should an unexpected financial situation occur. Thanks to Florida Homestead Protection, your homestead property is exempt from creditors so long as you are a permanent Florida resident, and the property is your primary residence.  (As mentioned in Chapter One, this protection does not protect against creditors who have a connection to the property, such as mortgage lenders, etc.)

The Florida government has historically defined homestead quite liberally, including not only single-family homes, but condos, mobile homes, etc. Because it offers unlimited monetary protection, some may opt to invest liberally in their residences as a way of protecting their assets. Still, while it protects a lot, Florida Homestead Protection does not protect one’s home from tax liens, mortgages, HOA assessments or mechanic’s liens. (Note: second homes, investment properties, properties titled in irrevocable trusts or other partnerships are also not covered with this protection.)

Beyond the Home

It’s true that for most families, their home is one of their most valuable assets. Still, most families have lots of other things that are valuable to them, from jewelry and savings accounts to retirement accounts, business acquisitions and more.

While domiciled in Florida, residents benefit from the fact that certain assets (such as one’s home, as discussed above) are automatically protected from claims by your creditors, meaning that even if you are sued (and lose) you will not lose them. Other assets protected under Florida law include:

• Life insurance policies and annuity contracts (including a broad range of contract and agreement types)
• Retirement plans, including pension, profit-sharing and IRAs
• Disability income
• Automobiles (up to $1,000 in equity)
• Prepaid college plans
• Miscellaneous exemptions (including but not limited to professionally prescribed health aids, hurricane savings accounts, medical savings accounts, and more.)
  
  

The above protection is generally unlimited, but those declaring personal bankruptcy may not be eligible for some or all of the advantages. Contact a lawyer or financial specialist to see how declaring bankruptcy could impact you.

In addition to the rules already set in place in Florida to protect your estate and assets, the state allows for numerous other measures to protect your assets from possible loss. Consult a trusted legal or financial adviser for full details.