Florida legislators sent a bill designed to encourage insurance companies to write flood insurance in the state to the governor Thursday, after removing several provisions that allowed homeowners to obtain limited policies.
The bill, HB 879/SB 572, allows insurers to write flood insurance to replace that offered by the National Flood Insurance Program and allows them to avoid rate regulation with the Office of Insurance Regulation for five years. Insurers must offer policies that track what is offerd by the NFIP by covering $250,000 or replacement cost, whichever is less.
The Senate voted 30-3, after the House approved it 98-11. Provisions sought by Sen. Jeff Brandes, R-St. Petersburg, had been removed by the House. His proposals would have allowed homeowners to obtain insurance that covered only the value of their mortgage, not the replacement costs of the home.
Opponents said that had the potential to give homeowners a false sense of protection for their losses while it protected the financial institutions holding the mortgage. Brandes said it offered the potential to give homeowners lower-cost options.
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"Obviously, I would have preferred flexibility,'' Brandes said, but said he would settle for the higher standard this year. “Let’s get the program started. Let’s let insurers begin to write,” he said.
Rep. Kevin Rader, D-Delray Beach, said last week that the bill as not needed. It began as a response to Congress' failure to deal with potential major rate increases in the National Flood Insurance Program but when the federal government agreed to modify the controversial Biggert Water Act the bill was unnecessary.
Rep. Dwight Dudley, D-St. Petersburg, backed the measure. "We need this bill,'' he said. "It doesn’t solve everything. It doesn't fix the entire problem. But it's a good step in the right direction."
House sponsor Ed Hooper, R-Clearwater, said the bill "gets the government off our back" and invites business into the state.