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Flood Insurance Relief Becomes Law| Tampa, Florida

Congress passed the Homeowner Flood Insurance Affordability Act of 2013 earlier this month.  All that remained was for President Obama to sign the bill into law and he did just that on March 24th.

What does all this mean for buyers and sellers of waterfront property in Tampa Bay?

The legislation  bill will prohibit the Federal Emergency Management Agency (FEMA) from increasing flood insurance risk premium rates and from reducing subsidies for properties not insured by the National Flood Insurance Program (NFIP) as of July 6, 2012.

This is a huge relief for many Florida homeowners and buyers.

The passage will ensure Section 207 of the Biggert-Waters Act is permanently repealed, meaning:

  • Grandfathered properties:  Properties built before 1975 were built before FEMA’s flood map was created.  These properties, if built to code the year they were constructed, will pay a lower flood insurance rate than those which were knowingly build in a flood zone.  Grandfathering stays with the property, not the insurance policy.
  • Cap on annual insurance: Homes built before 1975 will have their flood insurance annual premium increases capped at 18 percent .  Homes built prior to 1975 will have premiums capped at 18 percent with a five percent minimum.  For second homes, the cap is 20 percent if built before 1975 and 18 percent if built after.
  • Premium increase:  FEMA would not have the authority to increase premiums more than a 15 percent average per year.
  • Refunds:  Those who purchased an insurance policy after the passage of the Biggert-Water Act will receive refunds.
  • Surcharges:  An annual surcharge of $25 annually will be applied to primary homes and $250 annually will be applied to second homes.  Revenue will be placed in a NFIP fund for future use.
  • Home Improvement Threshold:  Premium increases won’t be triggered until a property reaches the “substantial improvement threshold” of 50 percent of a structure’s fair market value level.


Written by Rae Catanese, Realtor

Licensed Realtor since 2002, Tampa Bay’s own Rae Catanese regularly gives expert advice and insider tips about the Tampa Bay real estate market via her blog, The Tampa Real Estate Insider. If you are thinking of buying or selling a home in the Tampa, St. Petersburg or Clearwater areas-then this blog is for you. I typically post articles once a week. To make sure you don’t miss my newest posts, you can subscribe here! Have a real estate question? Email me here!

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