Soaring flood insurance rates hit snowbirds hard
Many Vero Beach homeowners are having sticker shock when they get flood insurance bills this year, which are sky-rocketing – and snowbirds are getting hit extra hard with an additional $250 on top of the new rate hikes and extra fees.
Take snowbirds Joanne and Don Anderson, who own a winter residence at Tarpon Island Club condominiums on the lagoon: A few weeks ago they got a letter from their insurance company telling them that because of federal legislation passed in April, they could expect their flood insurance to increase.
Last year, they paid $300 for flood insurance. But this year they will pay approximately $700.
That’s because the base rate for flood insurance is increasing 15 to 18 percent to fund the National Flood Insurance Program, which is $24 billion underfunded, making the Andersons’ base rate go up to between $345 and $354. Plus they’ll owe 15 percent more on top of that subtotal for a new federal reserve fund assessment.
Then comes a whopping additional fee of $250 because their Vero Beach residence is not their primary home, which is in Illinois. All told, they could pay over $700 this year and even more next year.
The letter their insurance carrier sent explained that people whose primary residences were in a flood zone could pay $25 instead of the $250 non-primary fee if they sent in proof that the residence was their primary home.
“Wait a minute,” Joanne told husband Don. “It’s not right that we have to pay a fee that’s ten times more than people who live here year-round. This is not a good message for us snowbirds.”
And that’s exactly what she wrote to Congressman Bill Posey, beginning with: “I don’t understand why the rate difference is so lop-sided against snowbirds. Do you not want us in Florida?”
She added that snowbirds do a lot to help the economy here and she hoped the congressman would speak up for them. (To date, she has received no response.)
For years, the Andersons, who stayed in Vero Beach for a little over six months from early November to mid-May, were registered to vote in Indian River County and listed their Tarpon Lane home as their primary residence.
But recently, before they learned about the flood insurance bill escalation, they shifted their primary home to their Chicago suburb house in order to vote for a friend running for office.
“It’s turning into an expensive vote,” said Joanne.
While the amount owed by primary residents will be less of an increase than for snowbirds, everyone will see a rise in flood insurance costs for 2015.
Aside from the 15 percent basic rate increase, which can go as high as 18 percent, and the 15 percent reserve fund assessment on top of that, year-round residents, who will pay another $25 for their primary homes, are likely to be assessed $250 extra if they have a guest house, which is counted as a secondary residence.
“Sometimes, the guest house fee can be successfully appealed, but for the other fees there’s really nothing your insurance agent can do,” said Joe Chiarella, an agent at Vero Beach Insurance.
“As a result we’re seeing a lot of emotional homeowners.”