Nearly 2 million Floridians depend on the National Flood Insurance Program for their flood insurance coverage, accounting for nearly 40 percent of all policies issued by the federal program nationwide.
However, a dire situation has been building for years and may soon reach a tipping point. Due to decades of underpricing its policies and a deluge of flood insurance claims in more recent years, the NFIP finds itself more than $23 billion in debt to the U.S. Treasury with no practical means to repay that sum.
In 2014 alone, Florida submitted nearly 2,700 flood damage claims and received more than $118 million in NFIP claims payments, more than double that of any other state.
Congress tried to fix this problem in 2012 by passing the Biggert-Waters Flood Insurance Reform Act, which would phase in rate increases for a fraction of those subsidized by the government. While a delay seems appealing, the truth is delaying the rate hikes would only make the NFIP's problems worse.
With the NFIP up for renewal in 2017, Congress has an opportunity to enact meaningful reforms that will strengthen the program financially, protect taxpayers and help consumers.
Encouraging more private insurers to start selling flood insurance products is a good place to start. The NFIP has a near-monopoly on flood insurance, and consumers would benefit from more choices. Market competition gives consumers access to more competitive rates and better coverage options.
At the state level, Florida is one of the few states that has bolstered its private flood insurance offerings. In 2014 and 2015, Gov. Rick Scott and state lawmakers passed a series of laws that simplified the process for private insurers to offer coverage, which has resulted in a small but growing market of private carriers, to the benefit of consumers.
At the federal level, Congress recently accomplished a rare feat of bipartisanship on flood insurance reform when the House unanimously approved the Flood Insurance Market Parity and Modernization Act.
The measure — sponsored by two U.S. House members from Florida, Dennis Ross, a Republican, and Patrick Murphy, a Democrat — is designed to lift many regulatory hurdles that discourage private insurers from entering the market.
Another way to enhance a healthy private flood insurance market would be to release historical loss data and other information currently held by the Federal Emergency Management Agency, which administers the NFIP. Florida state officials have requested that FEMA release this data to private companies in Florida interested in writing flood policies so that they may properly set premiums.
Our nation's flood maps also must be updated using modern technology. For far too long, homeowners and the NFIP relied on outdated maps that did not accurately reflect the risks the properties currently face.
In 2012 and 2014, Congress approved a series of measures to improve mapping, which will allow the NFIP and private insurers to price their risks more accurately and offer more appropriate, and in many cases, lower rates.
Finally, better funding of mitigation efforts would reduce the damage that natural disasters are able to cause. Proactive measures taken now, such as strengthening infrastructure and protecting natural buffers such as wetlands, would save money and lives later.
Financial assistance should be offered for low-income property owners to harden their homes, and incentives such as reduced insurance rates should be made available to all policyholders.
Floridians are counting on Congress to reform the NFIP. But the clock is ticking, and millions of policyholders cannot afford for this program to take on so much water that it becomes a sinking ship.
Christian R. Cámara is Florida state director and senior fellow of the R Street Institute, an American conservative and libertarian think tank headquartered in Washington, D.C., and is a member of the SmarterSafer coalition. He wrote this exclusively for the Tampa Bay Times. For more information, visit smartersafer.org.