Florida Flood Risks: FEMA, Citizens, and Home Insurance

Florida’s homeowners insurance market is in a state of crisis. In recent years, we’ve seen at least six major insurers withdraw from the state, driven by a combination of fraudulent roof claims, escalating windstorm losses, and the undeniable impacts of climate change. Rising sea levels, increasingly severe storms, and the soaring costs of construction and rebuilding have created a perfect storm, leaving homeowners facing unprecedented uncertainty.

With property loss estimates from recent hurricanes reaching staggering figures, Florida homeowners are bracing for potentially doubled insurance premiums, even with existing FEMA subsidies. As a native Floridian and real estate broker since 1984, I’ve witnessed firsthand the accelerating effects of climate change. From my time on Miami Beach in the late 1990s, when Biscayne Bay began encroaching on streets, to today’s challenges, the trend is clear: Florida’s coastline is changing.”

The Reality of Rising Waters

“The challenges in Miami Beach, where continuous efforts are made to elevate homes, streets, and seawalls, highlight the ongoing battle against rising tides. The increasing desirability of higher-elevation areas like Miami’s Little Haiti underscores the shift in real estate priorities. Now, living in Kenwood, St. Petersburg, I observe a similar pattern emerging in low-lying areas across the Gulf Coast. While Kenwood remains relatively safe, the Gulf Beaches, downtown St. Pete, Tampa, and other flood-prone regions are increasingly vulnerable.

Climate change, despite its seemingly unstoppable momentum, demands proactive measures from Florida homeowners. To mitigate the risk of policy cancellations and soaring insurance costs, consider these crucial steps:”

Protecting Your Investment

• Roof Maintenance and Replacement:
  • “In Florida, a shingle roof’s lifespan is typically 15 years. Insurance underwriters often require at least five years of remaining life. Replacing older roofs reduces insurance premiums and enhances property value. Consider replacing shingle roofs over 14 years old. Concrete roofs have different lifespans, but underlayment and installation remain crucial.”
• Hurricane Preparedness:
  • “Inspect and reinforce hurricane clips, roof bracing, and racking. Tree trimming reduces the risk of storm damage. Install hurricane-rated windows and doors for added protection, energy efficiency, and potential insurance discounts. Raising seawall caps and adding riprap provides vital protection for waterfront properties.”
• Understanding Insurance Policies:
  • “Familiarize yourself with 4-point inspections (roof, electrical, mechanical, plumbing). Understand the role of FEMA and Citizens in Florida’s insurance market. Be aware of potential changes to FEMA subsidies and their impact on flood insurance rates.”

The Future of Florida Real Estate

The question remains: are FEMA and Citizens a ticking time bomb for waterfront property values? Scientific data from sources like NASA and European satellites indicate an accelerated rate of sea-level rise, posing significant challenges for low-lying areas. Mortgage underwriters may eventually classify waterfront homes as high-risk investments.

The Biggert-Waters Flood Insurance Reform Act of 2012 and the subsequent Flood Insurance Affordability Act of 2014 highlight the ongoing debate over flood insurance subsidies. Recent hurricane losses, particularly the high percentage of uninsured homes in affected areas, underscore the necessity of adequate insurance coverage.

As Floridians, we must reevaluate our approach to insurance, preparedness, and the long-term sustainability of our coastal communities. The time to act is now.