National Flood Insurance Program

Boyd

Boyd

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We have discussed this in the past and I appreciate that it's a touchy subject, but it seems like we will eventually need to face it. I'm all for helping the victims in Texas, they need to be properly compensated based on the insurance they currently have. And as a nation we also have to help people with uninsured needs where appropriate. Any change to the current programs should be done slowly to allow people enough time to either move or find private coverage. But it rubs me the wrong way that we're all expected to pay for damage to expensive second homes at the shore which will continue being damaged.

https://www.usatoday.com/story/opin...idies-must-end-james-bovard-column/619926001/

"Rep. Jeb Hensarling (R-Tex.), chairman of the House Financial Services Committee, is pushing a bill that would curtail some subsidies and allow more competition from private insurers. A competing bill championed by Sen. Cory Booker (D-NJ) and Sen. Marco Rubio (R-FL) would perpetuate current perverse incentives and, as the New Jersey Star Ledger warned, would be 'almost certain to encourage more building in repeatedly flooded areas such as Mystic Island in Little Egg Harbor.' "
 
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Boyd

Boyd

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Just read another article on this topic in today's Wall St Journal. Harvey makes me wonder if I should have flood insurance even though I'm not in the flood plain. If we ever got 50 inches of rain I think most of us would be in trouble. :eek:

https://www.wsj.com/articles/insuring-coastal-cities-against-the-next-hurricane-harvey-1504282974
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"An estimated 50% to 80% of Texas properties flooded by Harvey aren’t insured, mostly because they aren’t located in the zone with a 1% annual risk of flooding
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This is a problem because insurance is a faster, fairer and more effective way to rebuild stricken properties than is post-disaster government aid."
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A committee advising the Federal Emergency Management Agency, which runs the flood-insurance program, has recommended replacing the 1% standard with risk assessments based on each structure’s elevation.
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BTW, you may only see a preview of that article if you aren't a subscriber. You can usually get around that by doing a search for the article title - paste this into Google:

Insuring Coastal Cities Against the Next Hurricane Harvey
 
46er

46er

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Your current home policy will not cover you from any flooding whether your in one of the FEMA flood zones or not. And you cannot just add flood insurance if there is a storm forecast as there is a 30 day delay for coverage. Lots of folks in NJ and elsewhere found out the hard way in October 2012. We used to have a policy, but stopped it after Sandy. I doubt we could have something like Harvey, that was due to humungous amounts of tropical rain from the warm gulf water.

https://www.fema.gov/national-flood-insurance-program/How-Buy-Flood-Insurance

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Boyd

Boyd

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46er said:
Your current home policy will not cover you from any flooding
Click to expand...

Right, I know that, sorry - should have been more clear. Was talking about National Flood Insurance and thinking more long-term than just the next storm. There was some pretty significant flooding in my area a few years after I moved here, maybe 2008 or 2009? It was very localized, did not see much of it elsewhere. No problems at all with my home, it is well situated. But I was surprised to see a bunch of places affected while their neighbors weren't.

Was also living in Medford during the big flood. That was unbelievable, IIRC we got 12 inches in less than 12 hours. Again, I was fine but a lot of people had major problems.
 
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46er

46er

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PineClark

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I don't disagree with your thoughts on insuring people in the flood areas. But aren't the people in these flood zones really the ones funding the insurance? I know if they are in the 100 yr zone they pay a few thousand. If they are outside of that, it drops to hundreds. We flooded with Irene due to a creek running behind houses on my street. None of us are in the 100 yr so technically not a flood zone. Though I found out my house is in the 500 yr zone which I never heard of before being flooded.
 
Boyd

Boyd

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PineClark said:
But aren't the people in these flood zones really the ones funding the insurance?
Click to expand...

I don't pretend to know any more than what I've read in a few articles, but my understanding is that the insurance premiums fall far short of covering the claims that are filed. The USA Today article above says "the program is actuarially doomed" for example. If it was a viable business model, wouldn't private companies sell this kind of coverage?
 
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PineClark

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LOL... yeah, I guess if it was viable, insurance companies probably would. I have a feeling flood insurance is like shorting stocks... you can make some profits, but the losses can go without limit!

And to your point, people keep building in areas with a known danger! I'm sure even if the insurance companies could come up with a formula, it will change every year as houses keep going up on rivers and coast lines.
 
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Boyd

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Another article: https://www.wsj.com/articles/building-boom-puts-millions-in-irmas-path-1505089111

"Building Boom Puts Millions in Irma’s Path
A 2015 report found that Tampa is the most vulnerable city in the U.S. to storm-surge flooding

Tampa posted a 25% increase in new building permits for single-family homes during the first seven months of this year compared with the same period a year earlier [ . . . ] That was one of the largest upticks in construction activity in the U.S."
 
46er

46er

Piney
Mar 24, 2004
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Do a quote on a property in the VE flood zone. It will be based on the properties current value and be 5 figures or more, this on top of the 'regular' home insurance policy. However, the max the homeowner would receive from the Fed flood insurance program for a total loss is $250K. Probably why so many homes are still awaiting repair or abandoned. But some folks do financially silly stuff, perhaps they can afford it, and others drive on the GSP :)
 
Boyd

Boyd

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bobpbx

bobpbx

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46er said:
Going up...

https://thesandpaper.villagesoup.co...s-could-surge-but-how-high/1686250?source=rss
Click to expand...

From that article:

....“They recognize that people that make a certain amount of money and live in a higher-hazard flood zone don’t have the financial resources to elevate their home, nor do they have the resources to pay the actuarily correct premium. So then it becomes a social issue as to what we do with all of these people who have these properties."

So, if your parents left you a house on the beach in LBI, which you enjoy immensely in the off-season, but are just breaking even paying taxes and upkeep because you don't have a job--but do reap some income from summer rentals, then someone will eventually bail you out from a flood. That would be other tax payers.
 
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