St. Petersburg, FL -- Drew Andrews and his wife Kimberly we're about to get nailed by skyrocketing federal flood insurance rates.
The $1,400 flood premium on their modest Shore Acres home in St. Petersburg soaring to nearly $9,000.
"We were gonna have to make some kind of change if we hadn't found this other policy," said Andrews. "Suddenly we were paying such a large percentage of our total cost toward flood insurance."
Then the Andrews found out private insurer Lloyd's of London would write them a flood insurance policy for just over $1,300.
"The coverage seemed good. And the price was obviously much better than what we were afraid we were going to have to pay," said Andrews.
Florida lawmakers recently started allowing private insurers to write flood insurance policies because the federal government rate was crushing real estate sales, and in some cases even forcing people who could not afford the rate hikes from their homes. FEMA had called for the re-vamped rates under the now-repealed Biggert-Waters act to replenish the agency's coffers which were emptied by storms like Hurricane Katrina and Superstorm Sandy.
"Now they have some hope," said Realtor Leanne Jamason with Smith & Associates.
Jamason says as a result, the federal government will now cut its flood insurance rates back to more modest levels starting May 1.
Clearly a desperate attempt, say insurance experts, to retain some of the thousands of homeowners abandoning their Federal flood policies.
"They're catching on. They don't want to lose business," said Jamason.
A warning, however. There may be some significant differences between a private flood insurance policy and the government's policy, including deductibles and the extent to which the contents of your home may or may not be covered.
Be sure to check with your insurance agent before making any policy changes.