The Government needs a national disaster fund. Why do I pay $6000 for flood insurance every year – although I’ve never flooded, only to fund those areas that are not required to have flood insurance. The same would apply to areas hit by tornadoes. $20 a year from each property owner would adequately fund a National Disaster Fund. $6000 a year from a handful cannot continue to support these disasters. Now I’m being notified my insurance may increase by 19% next year. How is this even possible. Many in my neighborhood are being forced to sell for this very reason. Shame on the very people we’ve put in office.
Katherine – did you choose to live in a low lying area, or were you forced to? If I choose to live away from the water, why should I be forced to subsidize your expensive waterfront home with a $20 (or whatever) disaster surcharge? I see the appeal of living close to water. I also see the appeal of a $500,000 sports car. I do not expect Honda Accord drivers to subsidize my Lamborghini insurance. You should not expect people to defray the increased risk associated with a waterfront property.
Katherine, are you obligated to purchase flood insurance? Or is it your most favorable economic risk management alternative? If you pay $6000 for flood insurance you most likely pay as much if not more for fire, wind and theft coverage on your home but I’ll bet you haven’t had a fire, wind or theft damage lately either.
I don’t think you are paying for others, you are part of a risk sharing pool and fortunately your “pool” has not filled with water “yet”.
We need reforms to NFIP but we shouldn’t privatize unless people have legally mandated access to flood insurance (like TRIA mandated terrorism coverage). We can’t leave undesirable risks with no access to flood insurance because relied on the government to keep the program running. It would be unfair to subject citizens to that degree of political risk.
If you want ‘mandated access’ insurance, the coverage has to have options for high deductibles, etc. Otherwise, no market would form. Economics 101.
Yes, undesirable risks could be left uninsured if they don’t accept high deductibles and are forced to mitigate their risk. What right do you think people have to access flood insurance at a loss from a private company?
Sheriff, there doesn’t need to be a market for this specific kind of coverage with mandated availability. The coverage could be an option that must be offered to all insureds on certain coverages (let’s say building coverage in this case) at certain minimum standards and maximum pricing. Insureds could have the option to decline coverage and obtain it elsewhere if they want different terms or they think they can get better pricing. The government could even step in to subsidize insurer losses due to “specified flooding events” that cause above certain amounts of damage to ensure insurer solvency.
All of this would work extremely similarly to TRIA.
Which investors not from a lunatic asylum would invest in insurers forced to disgorge surplus funds simply by selling flood insurance privately in a mandated availability (more commonly called ‘guaranteed issuance’) situation?
More reactive “leadership” out of DC. The NFIP will never be all things to all people, so pay attention to the flood maps, properties/areas with recurring flooding issues, and decide accordingly. Objective legislation will ensure that rampant and questionable development in designated flood areas (and I realize there are areas not in flood maps that also experience “less frequent” flooding) will decrease as it becomes cost prohibitive.
Rates must be risk adjusted. I’ve been put into an ‘AE’ zone from an ‘X’ zone in CA by a difference of 1 foot. Neighborhood has never flooded in 65 years since homes were built. Now we’ve got to get flood ins. to pay for people who live in an X zone and flooded in Texas. The ins industry is enjoying a huge influx of $ at our expense. So be it, but hopefully over time the rates (like water:) ) will find their own level.
Let the private market determine the right price for flood insurance. Then and only then will people stop building where they shouldn’t thanks to subsidized (with taxpayer money) insurance premiums.
If we don’t reauthorize the NFIP, then old cities like Baltimore, Alexandria, Boston, New York City will suffer as they are primarily old buildings with basements. Who wants that risk? What private carrier? I fear more city blight…first flood occurs with no insurance and no loans available. You guessed it – mass exodus and no residents. Real estate market would be in shambles.
THIS IS NOT ABOUT NEW CONSTRUCTION.
Congress has “kicked the can down the road” for over a decade now on NFIP and they are $23B in the red….Yes time for congress to actually do something or get out of the way!
So the folks who have insured their flood coverage through the Feds have made $25 Billiom back on their premium investment before the payouts on Harvey. Can any of you recommend a casino I can go to to place this type of bet? I like these odds!
So Sherriff, if you have a home flooded without Flood Insurance and looters get in there and abscond with Personal Property, a claim can be filed under HO for that Personal Property, right? How about Mold Damage? In Texas, we had a lot of mold problems years ago, so the carriers put limitations on mold claims. Most are $5,000 to clean it up.
I believe HO forms cover looting, whether after a cat or a riot or just plain ole looting.
Mold claims being limited is no surprise. Perhaps the data shows a $5000 limit is sufficient for most mold claims? So, agents must explain those limits clearly and suggest (could offer) supplemental coverage. Personally, I’d decide on higher limits based on where I live in the US. If the BL of $5000 isn’t sufficiently high, but is close to the average cleanup cost, I’d stick with the $5k of coverage on cats and treat a breach of that limit as better to be self-insured by me than to pay a premium.
The government should never be in the insurance business.
The Government needs a national disaster fund. Why do I pay $6000 for flood insurance every year – although I’ve never flooded, only to fund those areas that are not required to have flood insurance. The same would apply to areas hit by tornadoes. $20 a year from each property owner would adequately fund a National Disaster Fund. $6000 a year from a handful cannot continue to support these disasters. Now I’m being notified my insurance may increase by 19% next year. How is this even possible. Many in my neighborhood are being forced to sell for this very reason. Shame on the very people we’ve put in office.
No, the government needs to get out. Let the market decide what the “right” price for your flood insurance should be.
Katherine – did you choose to live in a low lying area, or were you forced to? If I choose to live away from the water, why should I be forced to subsidize your expensive waterfront home with a $20 (or whatever) disaster surcharge? I see the appeal of living close to water. I also see the appeal of a $500,000 sports car. I do not expect Honda Accord drivers to subsidize my Lamborghini insurance. You should not expect people to defray the increased risk associated with a waterfront property.
And yet they do.
Katherine, are you obligated to purchase flood insurance? Or is it your most favorable economic risk management alternative? If you pay $6000 for flood insurance you most likely pay as much if not more for fire, wind and theft coverage on your home but I’ll bet you haven’t had a fire, wind or theft damage lately either.
I don’t think you are paying for others, you are part of a risk sharing pool and fortunately your “pool” has not filled with water “yet”.
We need reforms to NFIP but we shouldn’t privatize unless people have legally mandated access to flood insurance (like TRIA mandated terrorism coverage). We can’t leave undesirable risks with no access to flood insurance because relied on the government to keep the program running. It would be unfair to subject citizens to that degree of political risk.
If you want ‘mandated access’ insurance, the coverage has to have options for high deductibles, etc. Otherwise, no market would form. Economics 101.
Yes, undesirable risks could be left uninsured if they don’t accept high deductibles and are forced to mitigate their risk. What right do you think people have to access flood insurance at a loss from a private company?
Sheriff, there doesn’t need to be a market for this specific kind of coverage with mandated availability. The coverage could be an option that must be offered to all insureds on certain coverages (let’s say building coverage in this case) at certain minimum standards and maximum pricing. Insureds could have the option to decline coverage and obtain it elsewhere if they want different terms or they think they can get better pricing. The government could even step in to subsidize insurer losses due to “specified flooding events” that cause above certain amounts of damage to ensure insurer solvency.
All of this would work extremely similarly to TRIA.
Which investors not from a lunatic asylum would invest in insurers forced to disgorge surplus funds simply by selling flood insurance privately in a mandated availability (more commonly called ‘guaranteed issuance’) situation?
More reactive “leadership” out of DC. The NFIP will never be all things to all people, so pay attention to the flood maps, properties/areas with recurring flooding issues, and decide accordingly. Objective legislation will ensure that rampant and questionable development in designated flood areas (and I realize there are areas not in flood maps that also experience “less frequent” flooding) will decrease as it becomes cost prohibitive.
Rates must be risk adjusted. I’ve been put into an ‘AE’ zone from an ‘X’ zone in CA by a difference of 1 foot. Neighborhood has never flooded in 65 years since homes were built. Now we’ve got to get flood ins. to pay for people who live in an X zone and flooded in Texas. The ins industry is enjoying a huge influx of $ at our expense. So be it, but hopefully over time the rates (like water:) ) will find their own level.
Let the private market determine the right price for flood insurance. Then and only then will people stop building where they shouldn’t thanks to subsidized (with taxpayer money) insurance premiums.
If we don’t reauthorize the NFIP, then old cities like Baltimore, Alexandria, Boston, New York City will suffer as they are primarily old buildings with basements. Who wants that risk? What private carrier? I fear more city blight…first flood occurs with no insurance and no loans available. You guessed it – mass exodus and no residents. Real estate market would be in shambles.
THIS IS NOT ABOUT NEW CONSTRUCTION.
How many times have THOSE cities flooded and blight occurred that is still there to see? Dates and places, please.
Superstorm Sandy is a recent example for some of the above cities.
Great example…are those cities and towns in shambles/ decimated as Beth suggests? Or, are just some properties decimated and abandoned?
New York City, flood prone? Really?
The Climate Change guys think NYC will be under water in the next few years, just like Miami, Seattle, Tampa, Charleston.
Congress has “kicked the can down the road” for over a decade now on NFIP and they are $23B in the red….Yes time for congress to actually do something or get out of the way!
So the folks who have insured their flood coverage through the Feds have made $25 Billiom back on their premium investment before the payouts on Harvey. Can any of you recommend a casino I can go to to place this type of bet? I like these odds!
Nope. They merely lost $23 Billion less than they should have had not NFIP been there to subsidize them, … on average.
So Sherriff, if you have a home flooded without Flood Insurance and looters get in there and abscond with Personal Property, a claim can be filed under HO for that Personal Property, right? How about Mold Damage? In Texas, we had a lot of mold problems years ago, so the carriers put limitations on mold claims. Most are $5,000 to clean it up.
I believe HO forms cover looting, whether after a cat or a riot or just plain ole looting.
Mold claims being limited is no surprise. Perhaps the data shows a $5000 limit is sufficient for most mold claims? So, agents must explain those limits clearly and suggest (could offer) supplemental coverage. Personally, I’d decide on higher limits based on where I live in the US. If the BL of $5000 isn’t sufficiently high, but is close to the average cleanup cost, I’d stick with the $5k of coverage on cats and treat a breach of that limit as better to be self-insured by me than to pay a premium.