This retired Florida couple saved $100K by ‘going bare’ on their home insurance, which had soared to $7K a year — is this money-saving hack worth the risk?

Jimmy and Heather Riley, a retired couple with a 3 bed, 2 bath home in St. Pete Beach, Florida, made a decision to “go bare” (another term for going without some or all coverage) on their home insurance in 2011 after their annual premium skyrocketed to $7,000, with a $20,000 hurricane deductible.

Rather than pay $7,000 to an insurance company every year, the Rileys agreed to save that money and not to spend it on anything “unless something happens to the house.” Over 13 years — and no major home insurance claims — later, the couple claims to have saved almost $100,000.

“That [money] would have been… given away to them [the insurance company] and they’ll just keep raising my rates no matter what, even if I didn’t have a claim,” Jimmy told ABC Action News.

Here’s why the Rileys went “bare” — and why this is a risk few homeowners can actually take.

Soaring costs in the Sunshine State

The Rileys make a fair point about home insurance rates increasing across the board in Florida, even for policyholders with a clean record.

Today, the average cost of home insurance in Florida is $4,419, according to Insurance.com (for a policy with a 2% hurricane deductible), which is well above the national average. Without the hurricane deductible, the average premium is $2,401 — but that leaves homeowners vulnerable to hurricane damage.

There are multiple factors driving insurance costs up.

First, extreme weather like hurricanes, tropical storms and flooding have triggered historically high catastrophe costs in recent years. And with sticky inflation, elevated interest rates, labor and material shortages, the property insurance claims caused by those weather disasters have grown more expensive.

Insurers in the state have also struggled to cope with excessive fraud and costly litigation in recent years, often revolving around bogus property damage claims — although that challenge is improving thanks to recent state insurance reforms.

Up against such challenges, insurers have struggled to run viable businesses in the Sunshine State. Since 2017, 11 companies that offered homeowners insurance in the state went into liquidation, according to Florida CFO and State Fire Marshal, Jimmy Patronis. Those still soldiering on have hiked their rates and become far more selective about what risks they’re willing to insure — and consumers are paying the price.

Facing seemingly never ending rate hikes, the Rileys highly recommend ‘going bare’ on your home insurance, but only if you can afford to do it and are willing to take a risk. Remember, in a hurricane-prone state like Florida, you’re at risk losing your entire home and having to cover total rebuild costs out-of-pocket.

Still, Jimmy Riley said “it’s the second best decision” he’s ever made (with a cheeky glance over at his wife). But this financially risky concept of “going bare” on home insurance is certainly not for everyone.