FLOOD INSURANCE REAUTHORIZATION NEEDS CHANGES AT FEDERAL LEVEL TO PROTECT FLORIDA KEYS HOMEOWNERS

MONROE COUNTY, FL – The latest National Flood Insurance Program (NFIP) reauthorization bill, HR 3167, was passed out of the federal level Financial Services Committee on June 12. The bill has bi-partisan support but lacks protection against increasing unaffordable flood insurance premiums for Monroe County homeowners. At Wednesday’s monthly Board of County Commissioner meeting, the commissioners unanimously approved a resolution urging inclusion of broader affordability protections for the new bill.

“Our main concern is this bill does not sufficiently protect affordability for all policy holders,” said Lisa Tennyson, Director of Monroe County Legislative Affairs. “This provision will protect only a very small, if any, percentage of Monroe County homeowners.”

The bill proposes establishing a five-year pilot program for primary homeowner policy holders who are at 80 percent Area Median Income (AMI). For those policyholders, the maximum chargeable premium rate will not exceed 2 percent AMI. Those who are not at 80 percent AMI, the current, steep annual increases will remain in effect at 18 percent for primary homes and 25 percent for second homes and commercial properties.

The Monroe County Board of County Commissioners has long-supported affordability protections in the National Flood Insurance program and urges the new bill include additional, broader affordability measures for all policy holders.

FEMA is planning on enacting a new NFIP pricing scheme in October 2020. The program, Risk Rating 2.0, will change the way FEMA prices NFIP policies based on three variables, including a structure’s distance to the water, exposure to different types of flood risk, and the cost to rebuild.

Monroe County has fought to lower the annual increases and has supported legislation that would have capped annual increases to 5-10 percent. The County would like to see a lower cap applied to all properties regardless of primary home, secondary home, or commercial building.

The bill does contain provisions for better mapping and allows policy holders to leave the NFIP for the private market and comeback without penalty, but it does not address issues like capping “Write Your Own” commissions, providing adequate mitigation funding for repetitive loss properties, or writing down the debt and reallocating the interest payments toward mitigation and premium reduction.

Monroe County has 31,000 NFIP policy holders with $7.5 billion in insured value. County homeowners pay $38 million in annual premiums.

“Florida has the most policies in NFIP, and as a peninsular state, will fare the worst with FEMA’s new risk-based pricing scheme, making it even more important to have affordability protections in any new legislation,” said Tennyson. “Florida, and all of its coastal counties, really do need to be the loudest on this.”

Monroe County has led an effort state-wide to protect NFIP affordability and recently had its NFIP resolution adopted by the National Association of Counties.

Tennyson urges Monroe County municipalities to adopt similar resolutions and for homeowners to reach out to organizations like Fair Insurance Rates Monroe County (FIRM) to voice concerns and support changes regarding the new program. For more information, visit www.monroecounty-fl.gov/nfip.

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