Flood insurance reform front unusually quiet despite major storms

Todd Moldenhauer, 51, left, and his wife Sharmaine, 47, who lives off Henley Road lost most of their belongings when Black Creek breached normal water levels causing major flooding due to Hurricane Irma in Jacksonville earlier this month. 
[OCTAVIO JONES   |   Times] 

Todd Moldenhauer, 51, left, and his wife Sharmaine, 47, who lives off Henley Road lost most of their belongings when Black Creek breached normal water levels causing major flooding due to Hurricane Irma in Jacksonville earlier this month. [OCTAVIO JONES | Times]
Published Sept. 29, 2017

Weeks after Hurricanes Harvey, Irma and Maria brought devastating floodwaters, it appeared problems with the federally-run flood insurance program would be thrust into the spotlight.

After all, Floridian activists have pressed Congress for years to stop a program that would dramatically raise flood insurance rates for residents in older, flood-prone areas that previously got lower, subsidized rates.

Yet, following the hurricanes, that previously vocal front for flood insurance reform is relatively quiet.

That's because the goal posts have changed slightly — again. What was once a Sept. 30 deadline for Congress to renew the National Flood Insurance Program is now pushed back to early December.

"We're in a holding pattern," said Patty Latshaw, vice president of compliance for Wright National Flood insurance.

The NFIP is a government-run program that has long been the dominant way to buy flood insurance. Florida accounts for about 40 percent of its policies. Wright has the highest number of NFIP policy holders of any insurance company in the country, and Pinellas County has the largest amount of properties with subsidized rates in the country

President Trump signed legislation on Sept. 8 that moved the program's renewal deadline back to Dec. 8, giving more time to local communities that are particularly sensitive to whether flood insurance rates are escalated dramatically or the NFIP doesn't get renewed in time.

One such area is Shore Acres, a low-lying waterfront community on the east side of Pinellas County. In 2016, Pinellas County Property Appraiser Pam Dubov saw nearly double-digit increases in sales prices for homes in the area. Between 65 and 92 percent of the homes then qualified for subsidized flood insurance rates.

Robin Sollie, head of the Tampa Bay Beaches Chamber of Commerce, said that despite the area flooding even in heavy summers storms, the community did not flood during the storm.

And two weeks after the storm, conversation about flood insurance was fairly absent.

"Everyone is focused on mitigating their level of stress and trying to clean up their yard," Sollie said.

The issue was brought back into the spotlight last year when there was widespread concern over rate hikes following a financial blow — a $23 billion deficit — the federal program took following Hurricane Katrina and Superstorm Sandy.

Remember the flood insurance scare of 2013? It's creeping back into Tampa Bay

What will sharpen the conversation is upcoming legislation that will potentially reshape the federal flood insurance program.

While it's too early to tell what the final version of the bill will be, Latshaw hopes that there will be a few specific elements included.

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"Long-term reauthorization is really what's needed in the bill," she said. That means something that will last around five years.

Simplification of the program is also necessary to help consumers have an easier time acquiring policies.

"Sometimes it can be very daunting purchasing (a flood policy)," Latshaw said.

One current bill attempting to reform the program is H.R. 2875, which was introduced in the House by Rep. Nydia M. Velázquez (D-NY). It outlines a revised appeals process for those with policies through the program who challenge a denied claim, penalizes companies that underpay program claims and expands some of FEMA's duties under the program.

"After Sandy, we heard from homeowners in New York City and up and down the East Coast who saw their claims denied, delayed or underpaid due to problems in the flood insurance program," Velázquez said in a release at the time. "This bipartisan legislation would address these shortcomings and protect policyholders from fraud and abuse."

The bill also establishes an advisory council. Among the council's duties is examining and making recommendations on rates.

A Senate bill introduced in July — S. 1571 — would extend the program through Sept. 30, 2023. It requires modernized flood mapping for communities covered by the program, pushes communities prone to flooding to create mitigation plans and calls for FEMA to factor in replacement cost value into premiums.

And on Thursday, the House passed a bill proposed by Reps. Dennis Ross, R-Lakeland, and Kathy Castor, D-Tampa, that seeks to pave the way for more consumers to take out flood insurance policies from private insurers. Flood coverage is currently is a very small segment of private insurers' business. H.R. 3823 — the "Flood Insurance Market Development Act" — calls for the development of a private flood insurance market to lower costs to consumers.

"The recent major flood events across the country have provided a much-needed sense of urgency to our efforts to provide consumers with private sector flood insurance options," Ross said in a statement.

The proposed bills will be addressed in the upcoming legislative session.

Contact Malena Carollo at or (727) 892-2249. Follow @malenacarollo on Twitter.