Flood insurance may soon be available from private carriers in Florida. The Senate has passed a bill that creates an alternative to the National Flood Insurance Program. The move could make a big difference in payments for property owners.
More than a third of the policies in the national flood insurance program are held by Floridians. But Florida accounts for just a small percentage of the claims that are paid. Now the national program is billions of dollars in debt because it hasn’t been charging premiums that match the risk.
So the cost of flood coverage is climbing – as much as 900 percent in a case near Tampa.
The increase could price some people out of their homes, since mortgages in high-risk areas require flood insurance.
Congress temporarily delayed some of the cost increases. But Sen. Jeff Brandes, R-St. Petersburg, says his bill provides a long-term solution.
“Congress acted several weeks ago to establish a glide path for the National Flood Insurance Program. But in a few years these dramatically high rates will be back upon us," Brandes told the Senate last week. "The federal fix does not solve the problem, Mr. President, it only kicks the can down the road.”
Brandes’ bill gives the state its own free market flood insurance program. He thinks a competitive market may mean lower premiums than those offered by the federal government.
Similar legislation is expected to get a vote by the full House.