8/21/2023 0 Comments Florida flood insurance costThe Florida flood-insurance requirement was included in an expansive bill approved by the state Legislature during a special session this week to revive the state’s crumbling insurance sector.ĭozens of local insurers have gone bankrupt this year or ceased covering property damage amid mounting losses. Even so, 7 million households in the state don’t have flood coverage. That’s the second-highest rate in the U.S. In Florida, the nation’s most flood-prone state, 19 percent of households have flood insurance. Yet many people flout that requirement, and less than 4 percent of households nationwide have flood coverage through the National Flood Insurance Program, which is run by FEMA and is the main provider of U.S. The requirement comes as federal lawmakers and officials are struggling to get more homeowners across the country to buy flood insurance and protect themselves financially against climate change.įederal law requires people to have flood insurance on property inside a flood zone if it’s secured by a federally backed mortgage. “It seems like that’s the only mechanism that really drives adoption.” View more information about the FEMA’s CRS program.“It’s probably a good idea to mandate people to have flood insurance,” said Paul Handerhan, president of the Florida-based Federal Association for Insurance Reform, a consumer advocacy nonprofit. Key West is advancing from a CRS Class 7 rating to a Class 5. The CRS What-If chart from FEMA shows the flood insurance statistics for Key West, and opportunity for reduced flood insurance costs. This savings comes on the heels of the Key West Fire Department’s successful efforts to reduce fire insurance premiums by getting the City reclassified as a Class 1 community by the Insurance Services Office (ISO) , upon which fire insurance rates are based. The average policy holder will likely save about $494, which collectively will save the community $3 million annually. Key West property owners pay $12 million annually for flood insurance coverage through the NFIP. There are currently 8,000 active flood insurance policies within the city, with an average annual cost of $1,510 per policy. Current Amount Paid for Flood Insurance Policies Local stakeholder groups, such Fair Insurance Rates for Monroe (FIRM) and the Key West Association of Realtors used their respective roles to help the City earn the 2,500 CRS points needed CRS Class 5 rating. The first discount (15%) was awarded Octoand upgraded to 25% October 1, 2020. The City worked diligently with FEMA to bring the community into compliance with FEMA standards to make the City eligible to apply for discounted rates under the Community Rating System. This discount is the result of several years of painstaking work, which included a major revamping of the building permitting and inspection process, so the City could demonstrate it’s exceeding the basic requirements necessary to participate in the flood insurance program and worthy of this increased discount for its citizens. The discount increased from 15% to 25% for new policies and existing policies renewing after October 1, 2020. The Federal Emergency Management Agency (FEMA) - which administers the National Flood Insurance Program ( NFIP), approved the enhanced discount, which will benefit most of the nearly 8,000 policy holders within the city and collectively save policy holders $3 million annually. As of October 1, 2020, most flood insurance policy holders in Key West will enjoy an even greater discount on their rates.
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