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Flood insurance changes afoot in Florida and, with luck, the US

The Tampa Tribune published an op-ed recently that ties in nicely with the Weather Channel's warnings about the remnants of Tropical Storm Erika. Tampa was beset by heavy rainstorms earlier this month, and the flooding and increased risk of flooding are clearly still on the community's mind. While Erika is no longer a tropical storm, the system is expected to drop a lot of rain on Florida early this week. It makes sense, then, that the subject of flood insurance would come up.

The column is a position statement of sorts for Stronger Safer Florida, a nonpartisan public/private coalition working to reform both Citizens Property Insurance Corp. and the Florida Hurricane Catastrophe Fund. In particular, the group wants to avoid post-hurricane assessments -- as we often discuss, if Citizens cannot meet its claim obligations, the state may levy an assessment against Florida residents -- by instituting stronger building codes, eliminating subsidies for coastal development, improving natural defenses against flood damage and making more flexible flood insurance available.

Flexible flood insurance coverage became available here on July 1, thanks to a bill passed earlier this year. Now, insurers and policyholders can negotiate what is covered and what the coverage limits are. For example, a policyholder may choose to insure his house but not the contents of his house. The same law included provisions to improve coastal development standards.

That law and all of its key provisions should not only apply to private insurance companies in Florida, according to Stronger Safer Florida. True reform will come only if the National Flood Insurance Program changes in kind. To that end, it just so happens that there is a bill in the U.S. House right now: The Flood Insurance Market Parity and Modernization Act.

The bill is ambitious, even if it's just a first step. We'll explain more in our next post.

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