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Florida Lawmaker Wants to Expand Private Flood Insurance Market

Mar 30, 2017

Florida residents understand that their homes are vulnerable to hurricane damage.

According to the Insurance Information Institute, seven of the 10 most expensive hurricanes in U.S. history have impacted Florida. In fact, six of these storms struck in 2004 and 2005 (hurricanes Katrina, Wilma, Charley, Ivan, Rita and Frances). But the costliest hurricane for Florida property owners was Hurricane Andrew in 1992, which caused $24 billion in damage.

Here are a few other hurricane-related facts from the Insurance Information Institute:

  • Florida homeowners hold more flood insurance policies than homeowners in any other state.
  • Flood insurance is typically provided by the National Flood Insurance Program, which in 2015 issued 1.8 million policies to Florida residents (this accounts for 35 percent of all program policyholders).
  • A significant majority of Floridians (98 percent) live in a coastal county, according to the U.S. Census Bureau.
  • Nearly 80 percent of Florida’s total insured property exposure is located in coastal areas.

What Is the National Flood Insurance Program?

Standard homeowner insurance policies don’t provide flood damage coverage. That’s why the federal government established the National Flood Insurance Program, which provides flood insurance, improves floodplain management and develops flood hazard zone maps. The program is managed by the Federal Emergency Management Administration (also known as FEMA).

If you are a property owner interested in purchasing flood insurance — or if you already have flood insurance — through the National Flood Insurance Program, visit FEMA’s website for more information.

Private Flood Insurance Options for Florida Residents?

One Florida legislator thinks it’s time that Florida made it easier for private insurance companies to offer flood insurance as a way of reducing the size of the national program.

Republican Senator Jeff Brandes, who represents Florida’s flood-prone west coast, recently introduced a bill that would permit insurance companies selling private flood insurance policies to set their own rates without having to seek approval from state regulators until 2025.

The bill also addresses “surplus lines” carriers. A surplus lines carrier means an unregulated insurance carrier. Under the Brandes bill, flood insurance agents would no longer have to be turned down three times by state-regulated carriers before being able to place a policy with a surplus line carrier. However, the surplus line carrier must have an “excellent” or “superior” financial strength rating from the A.M. Best Rating Services.

According to the Florida Office of Insurance Regulation, only 13 private companies currently offer private flood insurance that doesn’t piggyback on federal insurance policies. Nine companies also offer excess policies that provide coverage over the $250,000 structural limit under the federal program.

Brandes has said that most homes damages by flooding are covered by flood insurance and actually aren’t located in flood zones. That makes Florida residents more vulnerable than they might realize.

What steps should I take before disaster strikes?

The first step to protecting your valuable real and personal property is to purchase an adequate amount of insurance and the right type of coverage with the assistance of a reputable broker or insurance agent. The next step is to create a record of the property you are protecting, which may mean taking pictures or video of your real and personal property, or making copies or backups of your important business records. These records should be stored securely in the event of disaster, which may include off-site or on-line storage as appropriate.

If a storm is approaching, follow the recommended steps to protect your property by using sandbags, boarding up windows, etc. Be sure to follow any evacuation orders as well. Your safety and the safety of your family or employees should be paramount. Damaged property can be replaced; that is what insurance is for. If you run into difficulty with your claim, Insurance Litigation Group can help.

Contact Us Today

Damaged property can be replaced; that is what insurance is for. If you run into difficulty with your claim, Insurance Litigation Group can help. The team at ILG is led by attorney Michael Biberman, a former Florida public adjuster who has successfully worked through many hurricanes and other loss events,   will walk you through the terms of your insurance policy and the insurance claims process. We will take the time to thoroughly analyze your policy and will work to resolve any coverage dispute and also litigate issues of liability and damages to achieve an expeditious payment of benefits owed.

Our office includes speakers of English, Spanish, Creole and Russian to meet your needs. Contact us today for a free consultation if your property has been damaged by flooding.

Resources:

iii.org/article/florida-hurricane-insurance-fact-file

sun-sentinel.com/business/fl-bz-surplus-flood-insurance-bill-20170306-story.html

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