A bill to alleviate skyrocketing flood insurance premiums was filed Tuesday in the Florida Senate — an attempt to find a state solution to what has so far been largely a federal issue.
The bill, sponsored by Sen. Jeff Brandes, R-St. Petersburg, would encourage private companies to begin writing flood insurance policies in Florida to compete with the national flood insurance program and hopefully lower premiums, Brandes announced at a news conference.
The bill would streamline the state's regulatory procedures for flood insurance, add more state employees to vet insurance products and give home owners more flexibility about how much they insure, he said.
"We hope to have this bill to the governor's desk early in the session,'' Brandes said. "It is designed to go into effect immediately,'' he said, unlike most new laws which take effect in July.
Many mortgages written in Florida require homeowners to carry flood insurance, almost all of it provided by the National Flood Insurance Program. Congressionally mandated premium increases that began taking effect last year have caused some people's payments to rise so high that they cost more than the mortgage itself.
"It has killed the real estate market,'' said Treasure Island Realtor Shirley Madden, who attended the press conference at the Pinellas Realtor Organization office.
Because of how the national flood program now calculates rates, Floridians could end up paying 60 to 65 percent of all premiums nationwide once the Congressional changes are fully implemented, said Jay Neal, of the Florida Association for Insurance Reform.
That should create a big profit incentive for private insurers to enter the Florida market, said Re. Larry Ahern, R-Seminole.
"If Floridians are paying $16 billion to $20 billion (in premiums) and getting $3.7 billion back (in claims), there are profits to be made,'' Ahern said. "It's a great opportunity.''