Friday, October 19, 2018
Business

Rising flood insurance rates bearing down like a hurricane on Florida

Call it a warning. Or maybe even a cry for help.

However you characterize it, the letter sent to the director of the Federal Emergency Management Agency makes it clear that a new flood insurance law will be a catastrophe in coastal communities.

The letter warns of insurance rates that are "unaffordable'' and will have "devastating impacts'' that will "force families out of their homes.''

Sound too alarmist to be taken seriously?

Then consider that the letter came from U.S. Rep. Maxine Waters, D-Calif., who was one of the lead sponsors of the Biggert-Waters Act passed 15 months ago. Waters now says the legislation had unintended consequences, and she's calling for a review.

The House has already passed an amendment to delay a portion of Biggert-Waters, and all eyes are now on the Senate. If senators fail to act, the impact on Tampa Bay could be enormous.

"To me, the best analogy is this thing is like a hurricane bearing down on us,'' said Treasure Island City Commissioner Tim Ramsberger. "It starts off as this storm on the coast of Africa that you're really not paying much attention to, and suddenly, it's on your doorstep. Well, this thing is on our doorstep. It's real, and it's dangerous.''

If you're not familiar with Biggert-Waters, this is the short explanation:

For decades, the federal government offered subsidized flood insurance in low-lying or coastal areas. In other words, the price paid was not equal to the risk involved.

When the National Flood Insurance Program found itself $18 billion in debt last year, Congress agreed to an overhaul, with new flood maps for high-risk areas and nonsubsidized rates.

"They were trying to make up 40 years' worth of losses in about five years,'' said insurance agent Jake Holehouse. "This is a national issue, but because of our density, Pinellas will be the most affected area in the nation.

"It could be catastrophic for our real estate market.''

Lawmakers failed to grasp the ramifications of raising flood insurance rates as rapidly as they proposed.

A typical high-risk home in Pinellas will see its premium go up 20 percent annually until it reaches an actuarially sound rate. So a waterfront home paying $2,000 for flood insurance will be paying nearly $5,000 in five years.

And those are the lucky ones. Anyone who purchases a high-risk home — or who has purchased a home since Biggert-Waters passed last summer — will immediately be subject to the maximum rates.

For instance, Holehouse bought a home on St. Pete Beach in December. His current flood insurance premium is $1,900 but was scheduled to balloon to more than $12,000 under Biggert-Waters. By increasing the deductible and dropping his content insurance, he was able to reduce his premium to $7,400 annually.

The obvious danger is the potential impact on home sales and property values.

Jim White of Century 21 realty had a contract on a relatively modest $250,000 home in Redington Beach, but the buyer backed out when he realized his flood insurance would exceed $10,000.

The fear is that beach property values will fall, and homeowners could wind up upside down on mortgages and unable to afford insurance.

"These are people who bought small places with the idea they would retire on the beach,'' White said. "That's where it gets scary.''

Comments
Florida’s unemployment rate falls to 3.5 percent while Tampa Bay’s rate plunges to 2.9 percent

Florida’s unemployment rate falls to 3.5 percent while Tampa Bay’s rate plunges to 2.9 percent

Florida’s economy is continuing to hum along, according to September employment numbers released Friday. The state’s unemployment rate dropped to a mark last seen in February 2007 — 3.5 percent, down from 3.7 percent in August.And compared to a year ...
Updated: 5 hours ago
Jeff Vinik invests in another tech startup focused on health and wellness

Jeff Vinik invests in another tech startup focused on health and wellness

TAMPA — Tampa Bay Lightning owner Jeff Vinik has made a series of investments in companies focused on health, wellness and technology in industries ranging from construction to medicine, and from fitness to radiation protection.He’s at it again. This...
Updated: 6 hours ago
Hurricane Michael’s affect on timber industry ‘catastrophic

Hurricane Michael’s affect on timber industry ‘catastrophic", Adam Putnam says.

Hurricane Michael’s enduring legacy could include long-term damage to Florida’s timber industry.While experts try to get a handle on the carnage, state Agricultural Commissioner Adam Putnam said Friday that preliminary estimates peg it at $1.3 billio...
Updated: 6 hours ago
Is the annual pass worth it? As Disney changes pricing system, we help you decide

Is the annual pass worth it? As Disney changes pricing system, we help you decide

Though costly, annual passes at Disney World, Universal, Busch Gardens and other parks can sometimes be a smarter choice. You just have to know what you’re getting.
Updated: 7 hours ago
Tampa’s Oxford Exchange one of nation’s 50 most beautiful independent stores

Tampa’s Oxford Exchange one of nation’s 50 most beautiful independent stores

TAMPA — Architectural Digest has named Tampa’s Oxford Exchange as Florida’s most beautiful independent store — and one of the 50 most beautiful in the nation. Opened in 2012 in a onetime stable, the exchange a at 420 W. Kennedy Blvd. includes a resta...
Updated: 8 hours ago
After Hurricane Michael, a hunt for surviving oysters in Apalachicola

After Hurricane Michael, a hunt for surviving oysters in Apalachicola

APALACHICOLA — T.J. Ward’s phone rang. Service had improved in the days since Hurricane Michael. "Get another scrub brush and a squeegee,"he told his sister. "The littlest one you can find." The Ward family’s 13 Mile Seafood Marke...
Updated: 9 hours ago
A new Earth Fare is coming to Lutz this winter

A new Earth Fare is coming to Lutz this winter

Times Staff Writer LUTZ — Earth Fare will open its third location in Tampa Bay this winter, continuing to expand the area’s growing organic grocery market.Earth Fare entered Tampa Bay in 2016 with a location in Seminole and then opened a second in Ol...
Updated: 10 hours ago
Is Tampa Bay finally seeing signs of a buyer’s market? Soaring September sales hint at it

Is Tampa Bay finally seeing signs of a buyer’s market? Soaring September sales hint at it

Bucking a national trend, sales of single-family homes soared by double digits in Hillsborough, Pinellas and Hernando counties in September.That dramatic increase, coupled with minor price increases, suggests that a real estate market that has favore...
Updated: 11 hours ago
Aldi unrolls grocery delivery through Instacart across Florida

Aldi unrolls grocery delivery through Instacart across Florida

Savvy Tampa Bay shoppers may have already noticed Aldi pop up in their Instacart app earlier this month, but the discount store officially announced its delivery expansion across Florida this week.Instacart is a delivery service that allows shoppers ...
Updated: 11 hours ago
Tuna-gate: StarKist admits fixing prices, faces $100 million fine

Tuna-gate: StarKist admits fixing prices, faces $100 million fine

StarKist Co. agreed to plead guilty to a felony price fixing charge as part of a broad collusion investigation of the canned tuna industry, the U.S. Department of Justice announced Thursday.
Published: 10/19/18