U.S. Sen. Bill Nelson is among a group of Gulf Coast lawmakers expected to file legislation Tuesday to halt a flood insurance rate increase for homeowners.
Lawmakers from the House and Senate reportedly have agreed on a bill that would postpone a spike in premiums for property owners in high-risk areas. Pinellas County has the highest number of homeowners in the U.S. who receive subsidized coverage through the nation’s 40-year-old flood insurance program.
Florida’s political and business leaders have expressed concern that the spikes in insurance rates, which took effect Oct. 1, will harm the real estate industry and force some homeowners into foreclosure.
Under the terms of the new legislation, rate hikes would be delayed for four years, as FEMA conducts an affordability study.
“This is great news for many Floridians who’ve been told their flood insurance rates were going way up,” said Nelson. “If people can’t afford the coverage, what good is it going to do?”
Last year, Congress passed the Biggert-Waters Flood Insurance Reform Act to make the nation’s flood insurance program more financially sound. The program is in debt because of claims filed from Hurricane Katrina and Sandy, which lashed the northeast.
Insurance premiums went up Oct. 1, as reforms passed in 2012 ended subsidies for the “true” market rate. Flood insurance premiums have been increasing dramatically for people who buy properties that were previously grandfathered. Homeowners in the most flood-prone areas have been getting notices that their rates will increase.
Attempts by Nelson and others to address the issue were temporarily slowed during the recent 16-day government shutdown.