Sen. Schumer Warns N.Y. Homeowners About Flood Insurance Surcharge

By | May 12, 2015

U.S. Sen. Charles Schumer, D-N.Y., is urging the Federal Emergency Management Agency (FEMA) to make major changes to what he described as a new, unfair flood insurance rule that has led to the “misapplication of an additional fee of $250 for many Long Island homeowners renewing their flood coverage.”

Schumer said that on April 1, FEMA began charging flood insurance policyholders an additional $250 if the policy covers their secondary residence and $25 if the policy covers their primary residence. But he noted that homeowners must fill out a new “proof of primary residency” form with their yearly insurance renewal, otherwise FEMA will default to charging them the secondary home fee of $250.

He said that while the majority of Long Island homeowners in New York affected by the new rule are primary homeowners and should be charged a $25 surcharge, many of these policyholders are being charged $250, the secondary residence fee.

Schumer said this is because many residents — and even some insurance companies — are still in the dark on the new renewal requirement and haven’t been filling out the necessary documents. Schumer warned residents of the change and urged them to check their bills to see if they were charged an extra fee of $225.

Schumer said he is pushing FEMA to scrap this new rule altogether and go back to the drawing board to come up with a policy that is not potentially punitive to homeowners, especially since so many are still getting over the devastation of Superstorm Sandy.

“After being hit hard by Superstorm Sandy, unsuspecting Long Island homeowners are now being socked with a surprise fee of $250 because of a new, unfair policy on flood insurance renewals,” said Schumer.

Schumer added: “Many Long Islanders remain in the dark on this new renewal requirement and that’s why FEMA should scrap this confusing and potentially punitive policy altogether. FEMA needs to go back to the drawing board and quickly figure out a new and fairer way to implement their renewal policy.”

The new mandatory surcharges are being applied to all flood insurance policies under the National Flood Insurance Program. A policy for a primary residence will include a $25 surcharge. All other policies, including those of non-residential properties and non-primary residences, will include a $250 surcharge.

In April, FEMA began mailing notification letters to policyholders, Schumer said. Homeowners are told in the letters that they have 30 days to fill out the necessary paperwork and provide proof of primary residency or their renewal premium will reflect the higher surcharge. If the paperwork is not filled out and mailed to FEMA within 30 days of receipt, a default charge of $250 is included on the policyholder’s bill.

New York has approximately 143,000 policies rated as residences. Approximately 12,000 primary residence verification letters in New York are being sent out by FEMA per month.


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