Thursday, February 22, 2018
Business

With Florida blindsided by flood premium crisis, is it time for new state-run insurer of last resort?

Is a state-run flood insurer of last resort in Florida's future?

Never should it have come to this.

An insanely poor piece of federal legislation called the Biggert-Waters Flood Insurance Reform Act of 2012 tried to fix the nearly bankrupt national flood insurance program in the wake of Hurricanes Katrina and Sandy. How? For starters, by foolishly raising premiums — not via gradual price hikes but in draconian style.

Tales proliferate of irate Florida owners of modest homes along the coast or in lower-lying areas. Many face annual increases of 20 to 25 percent. And if they sell, the annual bill in some cases can leap from $2,000 to $12,000 or even higher.

The Florida real estate industry, whose national organization naively embraced Biggert-Waters last year, is now up in arms. Realtors are terrified that vast swaths of Florida homes will drop in value or become pariahs to buyers forced to inherit sky-high flood premiums.

Today's flood insurance fiasco smells a lot like the days that followed 1992's Hurricane Andrew. That's when property insurers in Florida panicked and said they must stop insuring homes in the state or start sharply raising their premiums. The public outcry back then from such threats prompted the creation of the state-run "insurer of last resort," which we know now as Citizens Property Insurance.

While establishing a state-run insurer of flood insurance may seem unlikely, something must be done soon to help those home­owners who will end up paying more for flood protection than they pay on their mortgages.

Perhaps Florida should listen to a nearby state rather familiar with floods.

Louisiana Treasurer John Kennedy suggested this week that his state explore getting into the business of offering flood insurance to help residents who, like Floridians, will suffer the same skyrocketing flood premiums.

Louisiana already operates state-run corporations for property insurance and workers' compensation coverage.

Given Florida Gov. Rick Scott's preference to minimize the role of government in private enterprise, a state-run insurer for flood insurance could prove a hard sell.

But if Scott gives a thumbs-down to such an idea that takes root in other states, what is his alternative plan?

Many Floridians in flood-prone areas will see huge leaps in flood insurance prices in the coming year. That could turn the cost of flood coverage and the potentially devastating impact it has on real estate values into a major campaign issue in 2014, when Scott seeks re-election.

Scott has a clear habit of flip-flopping on issues that endanger his stay in office.

One alternative, of course, is to persuade federal legislators to reconsider Biggert-Waters and phase in higher rates over a longer period of time.

For now, Florida is mobilizing to delay or soften the coming premium hikes. That's the mission of forums, including an event Wednesday evening held at St. Petersburg College attended by 500 people.

It's disturbing so few in Florida saw this threat coming. Florida's got too many other critical challenges than to be whipsawed by such poor legislation whose passage was naively approved by too many Florida elected officials.

Robert Trigaux can be reached at [email protected]

Comments
Administrator Haley Loeun fired from CareerSource jobs centers

Administrator Haley Loeun fired from CareerSource jobs centers

Haley Loeun, a top aide to the embattled leader of the Pinellas and Hillsborough jobs boards, was fired Thursday from her $130,000 position as business services director. Loeun came under criticism after the Tampa Bay Times reported that CareerSource...
Updated: 3 hours ago
Outback Steakhouse owner Bloomin’ Brands beats Wall Street forecasts

Outback Steakhouse owner Bloomin’ Brands beats Wall Street forecasts

TAMPA — Outback Steakhouse has been pressured to improve for awhile, but the restaurant chain isn’t cooked yet. In fact, a boost in Outback sales led its Tampa-based parent company to beat Wall Street expectations in its fourth quarter.Bloomin’ Brand...
Updated: 3 hours ago
Tampa Bay area’s population projected to grow to 3.1 million this year

Tampa Bay area’s population projected to grow to 3.1 million this year

TAMPA — The Tampa Bay area’s population, already the largest of any metropolitan area in the state, is projected to grow from 3 million last year to 3.1 million this year, and to 3.3 million over the next five years.That growth is expected to bring c...
Updated: 8 hours ago
Work finally starts on downtown St. Petersburg’s newest hotel

Work finally starts on downtown St. Petersburg’s newest hotel

ST. PETERSBURG — Nearly a decade after it was first proposed, a new boutique hotel in downtown St. Petersburg is finally under construction.Workers are preparing the foundation of the Galaxy, an 11-story, 92-room hotel at Third Avenue N and First Str...
Updated: 9 hours ago
Note to readers: About those annoying popups on your phones

Note to readers: About those annoying popups on your phones

Dear readers, I hope that you are able to see this and that a popup saying you’ve won a gift card hasn’t taken over your phone. We have heard from many of you that these popups are preventing you from reading our news coverage.We hate them as much as...
Updated: 9 hours ago
Saving trees a passion for some St. Petersburg neighborhood leaders

Saving trees a passion for some St. Petersburg neighborhood leaders

ST. PETERSBURGBeth Connor, a longtime neighborhood environmental advocate, is alarmed at what she views as the destruction of the city’s trees in the name of development.She points to at least three properties that have been scraped of trees in recen...
Published: 02/22/18
This week food fests celebrate collard greens and Jewish foods

This week food fests celebrate collard greens and Jewish foods

FIELD OF GREEN: COLLARD FESTOn Saturday you can devote your whole day to the beauty of collard greens. Well, that’s the jumping off point. Collards are the "central ingredient" at the Tampa Bay Collard Green Festival at St. Petersburg’s Historic Deuc...
Updated: 10 hours ago
CareerSource jobs chief Edward Peachey could soon be out of work

CareerSource jobs chief Edward Peachey could soon be out of work

CLEARWATER — The heads of the Pinellas and Hillsborough jobs boards will hold emergency meetings in the coming days to consider firing president and CEO Edward Peachey. Jack Geller, board chairman of CareerSource Pinellas, and Dick Peck, chair...
Published: 02/21/18
Updated: 02/22/18
Hillsborough commissioners ask CareerSource chief to step down or be fired

Hillsborough commissioners ask CareerSource chief to step down or be fired

TAMPA –– Hillsborough County commissioners voted Wednesday to ask embattled jobs center leader Ed Peachey to either resign or face termination over concerns the agency inflated job placement numbers with the state. Chairwoman Sandy Murman said commis...
Published: 02/21/18
St. Pete's World Liquors sign will live on at new home

St. Pete's World Liquors sign will live on at new home

A local landmark for a half century isn't coming down for good.
Published: 02/21/18