It’s not an April Fools’ joke; flood insurance premiums will begin to increase today. The increased premiums are happening now as part of the Flood Insurance Relief Bill that was signed last year in response to the increased flood premiums that were being sent to policyholders under the Biggert-Waters Flood Insurance Reform Act of 2012.

The highly criticized Biggert-Waters Flood Act of 2012 was set up to was shore-up the national flood insurance debt, but the way the law was written caused the cost of flood insurance for many property owners to skyrocket without a gradual implementation. With little warning, 2014 premium invoices were sent to homeowners for tens of thousands of dollars for one year of coverage. Many of these homeowners were not even in waterfront communities but have property that falls on the flood plain map and were required to carry the insurance by their mortgage company. There was an uproar around the nation and many real estate markets—even in inland areas—took a giant step backward.

The remedy: The Homeowner Flood Insurance Affordability Act of 2014, which stopped the 25% annual increases and lowered the percentages to 15-18% on most policies. April 1, 2015 is the day the fees and premium increases will be implemented on renewal notices.

Homeowners can expect to now pay a higher percentage and a pay a $25.00 surcharge for their primary homes while those who have multi-family or secondary homes will pay a $250.00 fee. The rate hikes will also vary but primary homeowners will see a 15-18% rise in the costs but nothing higher than 18%. Other properties including businesses can have a 25% increase.

In 2014, it was reported by the Washington Times that the National Flood Program is somewhere around 24 billion dollars in debt and 90% of U.S. National disasters involve some sort of flooding according to the Palm Beach County Flood Facts.

Be sure to check out these other posts on flood insurance rates

Will Flood Insurance Rate Submerge Tampa Bay?

Raise Your Home or They’ll Raise Your Rates

  • Kris S Kelly

    24 billion in debt yet how many mailers do they send out a year on the same policy within weeks? How much could those unnecessary costs could potentially save? Now they increase the deductible on a preferred policy add two more fees of which one may be almost the same or as much as the base rate for your policy the year before on a secondary or investment property. Why must they continue to penalize the people who are voluntarily buying into these government subsidized fairytales by biting the hand that feeds them? So if you had a secondary or investment property that you previously purchased preferred coverage on in Florida or anywhere else for that matter only to now find out your policy will likely double how likely are you to renew that policy? How likely for an increase from $22 to $82 in fees and an increase in deductible on a primary home? Most of you I’ll assume have read the policy and know what is and isn’t covered. Where do you suppose this will leave us in five years? Will it matter then or will we get another catchy solution with “affordability” in the name that is just another gimmick that reminds me of the scene from the Wizard of Oz (Pay no attention to the man behind the curtain)

  • I can see why the rates for flood insurance are going up. People may not like it because they are paying more, but things are becoming more expensive as we go into the future. The good news is that instead of the 25% rate increase annually we are only getting a 15 to 18% like you mention. Thanks for the awesome flood insurance information.

  • Gilbert Yablon

    “Homeowners can expect to now pay a higher percentage and a pay a $25.00 surcharge for their primary homes while those who have multi-family or secondary homes will pay a $250.00 fee. The rate hikes will also vary but primary homeowners will see a 15-18% rise in the costs but nothing higher than 18%”

    In this quote from your article you refer to primary and multi-family homes. Is an owner occupied 2 family home, which is the owner’s primary residence, considered multi-family? My insurance company says only single family homes are “primary”residences and have therefore imposed a surcharge of $250..