For years, national and Florida disaster officials raised a pair of related concerns. The large increase in building in vulnerable coastal areas would make it hard to evacuate such areas when a major hurricane threatened. The other was the impact — the huge amount of property damage resulting from a big storm hitting built-up coastal areas would devastate the property insurance market.
Even taking the Hurricane Katrina and Superstorm Sandy tragedies into account, there hasn’t been a loss of life on the scale the disaster planners have feared. The property insurance market, however, is in perilous shape.
Congress, facing a big deficit in the Federal Flood Insurance Program, passed the Biggert- Waters Act in 2012. It, however, is already retreating in the face of howls of protest over the sharply higher federal flood insurance rates Biggert-Waters mandated, and is proposing a delay in the rate increases.
State Sen. Jeff Brandes, R-St. Petersburg, is sponsoring legislation he hopes will give Florida property owners a cheaper alternative. His bill seeks to entice more private insurers to offer flood insurance coverage. The state set up an alternative insurer, Citizens Property, but the size of its storm damage exposure has Citizens trying to shift as many of its policyholders to the private market as it can.
There is no painless way out of the flood insurance dilemma. Among other things, Brandes’ bill would allow insurers to offer policy options such as lesser amounts of damage coverage in exchange for lower rates. That may not strike some as ideal, but at least it is an idea on the table for people to debate.