April 1, 2015, the Homeowner Flood Insurance Affordability Act went into effect. This will cause a rise in flood insurance for thousands of residents in flood zones, specifically those who have property in coastal areas and those living along lakes, rivers and bays in Florida.
“Unfortunately, this has been a long time coming. Many coastal residents knew the rising cost of flood insurance was inevitable. It is the price for living on the beach, said Dustyn Shroff, Vice President of GreatFlorida Insurance.
The Homeowner Flood Insurance Affordability Act allows the government to slowly phase out subsidized flood insurance for millions of Americans owning property in flood zones. “Florida accounts for 40 percent of all flood policies in the country with Pinellas County having more subsidized policies than any other county in the U.S.,” said Buck.
The new law will help repair the National Flood Insurance Program by reducing the $24 billion deficit as a result from payouts from Hurricane Katrina and Sandy. The goal is for insurance premiums to equal the risk of owning property in a flood zone.
Floridians owning primary residences in a flood zone will see an average of a 10 percent increase in their premiums as well as an annual surcharge. Homeowners with a secondary property in a flood zone as well as those who have experienced repeated flooding will continue to see their premiums rise by 18 to 25 percent a year until reaching a level consistent with their risk of flooding.
According to the National Oceanic and Atmospheric Administration, (NOAA), “Flooding is the most frequent and severe weather threat.” With 90 percent of natural disasters in the U.S. being flood related, it is also the costliest natural disaster. Conservation groups support the new act as they say each year sea levels will continue to rise, making living close to the ocean more risky.
Florida homeowner insurance does not cover damage caused by a flood. Federal disaster assistance is only offered when the president declares a major disaster, which only happens half of the time. Flood insurance is available to protect homes and businesses through the National Flood Insurance Program.
For more questions about homeowners insurance and flood coverage contact GreatFlorida Insurance at 888-478-7801 to speak with an agent or visit our website at www.greatflorida.com.
