If you really want to fight (section 205) of Biggert-Waters go to your US Congressmen and ask them why they would support raising homeowner rates and at the same time condone these unjustified LOMR approvals? It’s a good question that deserves an answer.
Alabama Senator Richard Shelby is the road block. He adamantly defends section 205 of Biggert-Waters and will not budge. It’s really hard to understand when he claims that making the NFIP actuarially sound is a priority yet, he does nothing to prevent unjustified rate decreases for gulf front condominium buildings in his own state. Obviously individual homeowners and small businesses are expected to make it up.
In the past five years a company out of South Florida, Flood Zone Corrections, started submitting Letters of Map Revision (LOMR) applications on gulf and ocean front condominium buildings along the Florida and Alabama coastline. Many of the buildings had sustained major flood damage from hurricanes and some were actually in the NFIP Repetitive Loss Program. Even with these facts available, FEMA officials determined these water front buildings were not in velocity flood zones. The buildings were rezoned and premiums have been reduced by an average of over 90%.
Now US Legislators and FEMA officials have decided to implement (section 205) of the Biggert-Waters Act in an attempt to make the program more actuarially sound. Thousands of homeowners and small businesses will see massive rate increases on their National Flood Insurance Program (NFIP) policies. How can Legislators and FEMA officials justify this action when they gave ridiculous unjustified rate decreases to condominium owners with the highest risk of flood loss? Homeowners and small businesses should not be unjustifiably penalized. This is not how you make the NFIP program actuarially sound.
Over the past couple of years the federal government has paid billions of dollars in federal assistance for properties that don’t carry flood insurance. We’ve seen it in New Jersey, Tennessee and this year Colorado. The easiest way to make the program actuarially sound would be for the federal government to required flood insurance on any property that had a federally backed loan regardless of where it’s located. Everyone would pay for their actual risk. The fact is flooding happens everywhere and it can’t be predicted.
Politicians are reactive not proactive and it appears they only react when an issue affects votes. The approval of LOMR’s on these repetitive loss and ocean/gulf front condominium buildings shows that making the NFIP actuarially sound was never a priority for any US Legislator or NFIP official until they saw an opportunity to capitalize off Biggert-Waters. Yes, affected homeowners and small businesses will be upset with them but they know the vast majority of voters think people living on waterfront coastlines are rich and they deserve to pay these tremendous rate increases. Most of these people are not rich and many will lose their homes due to Biggert-Waters.
FACT: According to the current FEMA flood maps, in Orange Beach and Gulf Shores, Alabama, there are 77 condominium buildings located in “V” flood zones on the gulf front. Over the past three years 71 of those 77 buildings have been approved for LOMR’s. One of the requirements of getting a LOMR approved is the community must concur with the revision. In Orange Beach and Gulf Shores the flood plain managers disagreed with the LOMR’s and, in every case, declined to sign concurrence letters. The flood plain managers knew these buildings had suffered flood losses during Hurricanes Erin and Opal in 1995, Hurricane Danny in 1997, Hurricane Georges’ in 1998 and Hurricane Ivan in 2004. What’s really amazing is FEMA had already placed at least ten of these buildings in the NFIP Repetitive Loss Program. Although these buildings have received millions of dollars in flood claims, FEMA officials decided they should not be in high risk flood zones. The approval of these LOMR’s allowed the condominium buildings to be moved from “V” flood zones to less hazardous “A” flood zones. The annual premiums were reduced by over 90% and the annual revenue loss to the NFIP is over $5MM. All of this is happening within a program that’s operating at a deficit of over $25 billion.
There is a way to help subsidize flood rates. The Federal government could require every home owners policy cover flood. Like stated, flood can happen anywhere. So why should some home owners get away without buying flood insurance because they live away from the coast, but as soon as a flood hits them, the government bails them out? If everyone had the coverage, and every carrier had to supply it, rates would go up, but the people in low flood zone areas would pay little, but still something to go into the fund. Even here in Phoenix, AZ we can have flooding but most of us are not in a flood zone and most of us will never be affected. However, even if all three million of us, well lets say 1,000,000 homes, pay $50 more a year, that’s $50,000,000 from one city. Of course people in high flood zones would still have to pay more, but maybe not $12,000 more, but maybe only $5,000 a year. Sounds to me like a win win. I wouldn’t have a problem paying an extra $50 a year, plus I’ll have the peace of mind of having flood insurance incase CAL floats away. LOL
Eventually, You have to pay for what you get and for too long the rest of us have been subsidizing their ocean front view. Global climate change is going to wake lots of people up and they will soon realize that it s a reality.
Terry, I agree. You do “have to pay for what you get”. But I can’t really trust that these new rates are the true, actuarially sound rates when I hear about increases from $1000 to $12,000. What are the credentials of these people that develop these rates? Are they the same people that help determine high risk vs low risk zones? If so, I don’t have much confidence in them. FEMA data states that 27% of all flood claims occur in low risk zones. That doesn’t sound like FEMA’s very accurate with the low risk vs high risk determinations.
I’m not sure the “ocean front view” has been the majority of the problem. Flooding has occured in the Mid-West, Nashville, and many other places. We’ve all paid for this.
Do your research. This is affecting a lot more than people on the beach. There are people miles inland from me (on the beach) with modest homes who are going to see their flood insurance go through the roof, to say nothing about the value of their homes going down because nobody wants to pay the insurance. I personally know 4 realtors that have told me that they have lost a combined total of over 30 deals just in the past 2 weeks. You thought the recession was bad, look out for this one. Think of everyone even NEAR water (lakes, rivers, even retention ponds). Every state has SOME water. How about Mississippi with the river, Missouri with theirs, to say nothing about Minnesota and other states. 100 year flood plains are affected also, so even if someone hasn’t had a flood in 50 years it won’t matter, their insurance is going to go up.
So, you’re on a barrier island in a proven hurricane/flood area, and you wonder why your flood insurance is ONLY $1,000 a month? We are supposed to continue subsidizing people who continue to buy/build in flood zones? Wow…..
Typical response (Carson) from someone who wants something for nothing and wants hard-working people to suffer. Continue to penalized those that have worked hard all their lives to afford a nice second home – yeah right! You haven’t subsidized anything! Instead of throwing a barb at these folks how about sympathizing with their plight. They played by the rules and were betrayed by their Realtor and their government.
We are much too busy sparing no expense (and inventing plenty that don’t even exist) to fight Wars on Nouns that we will never win but continue to wage. We have allowed our so-called leaders to gut program after program that built this country, and we continue to do nothing as they sell off the rest, from school systems to the postal service to our highway and bridge infrastructure to our prisons and water systems. One day, the curtain will drop, and we will all turn around and find a brick wall in place of exits.
I’m not rich, but doing OK and have planned pretty well (I’m told) for retirement. But Guess what? My plans don’t involve buying a beach house in a hurricane/flood zone!
Good grief. The land of the free & home of the brave has become the “I want what I want, and you have to help me get it” land.
I’m shocked by the amount of people who dont know that a lot of homes in the flood zone arent on the beach. Flooding just occurred in Colorado is that state on the beach? And guess what it didnt only affect the reach people.
How many “barrier island getaways” have been rebuilt by the taxpayers several times in the past 40 years. It is time to take a hard look at all of he property built in high risk (flood, storm, fire, etc) areas and turn some of the subsidized costs back on the buyers and developers. This includes homes in the middle of Colorado and Montana forests as well as beach homes in Florida.
Bob’s comment about crop insurance is on the mark (or should that be the money). The crop insurance program was developed to protect the family farmer, not giat corporations, hedge funds and foreign investors.
Funny how all of these complaints are about Hurricane/Flood zones and yet look at the last 5 years and tell me where all the flood claims have originated. Other than Hurricane Sandy- most are not anywhere close to the coast. Love how the government is wanting to change a subsidized program that has been around for over 40 years and yet they start another subsided program with the Affordable Health Care Act. Thats the kind of logic only found when the government on any level is involved. There are much better ways to ensure the solvency of the flood program- like adding a $100.00 to all homeowners policy in the US. I would start there.
If I took the time to evaluate the likelyhood of floods before I bought my house, why can’t anyone else?
Yes, there are disasters and floods in my state. I don’t think giving the federal government more money is the right answer, no matter who’s giving the money. I espeically don’t agree with charging ALL homeowners.
I just got a check from United Health Care reimbursing me for over $300 because of the Affordable Health Care Act and the fact they can’t gouge us without reason and keep the money.
Rates should be based on potential risk and exposures. I agree with InsGuy above.
Also, I am in Tn and regarding gov’t bailouts of flooded areas, in the early 1970s we were flooded in Chattanooga. There were no gov’t bailout/handouts. What the gov’t did offer was low interest loans to fund repairs not paid for by insurance. We were very grateful for the assistance, and paid back the loans with interest, at no net cost to other taxpayers. In 1970, no one would have expected the handouts which are the norm today.
You are not referencing the devastating Cumberland River flooding in 2011. There is a world of difference between the people, the businesses and the attitudes of the TN residents affected by THAT flood and the NY’ers and NJ’ers (still whining with their hands out) of superstorm sandy.
The only question I have is how can you purchase a $600,000 home in the beach and not have $12,000 to spend yearly on flood insurance?! It would be like purchasing a BMW M5 and saying you can’t afford premium gas.
Also, why in the world was it their P&C agent’s responsibility to “tell them of the impending flood rate changes”?! It would be like blaming the dealership you bought an M5 from for not telling you that the price of premium gas would increase.
Tsk, tsk, this self-entitlement mentally and lack of self accountability is just incredible.
I agree. If anyone dropped the ball on this it is these folks own real estate agent. A quality real estate agent is going to have a handle on anything that may impact the market and home prices. Their real estate agent should have been aware and informed them of the possibility of an insurance rate increase. Oh, wait, the real estate agent was probably focused on the commission.
Re your comment about purchasing a $600,000 home (and also a BMW M5), unfortunately most folks don’t look at the price of a house/car, they only look at the payment they can afford. In actuality, these folks can’t afford a $600,000 home.
No point in debating this issue on insurancejournal.com. This is not a neutral audience. The insurance industry stands to gain the most from this and was it’s primary supporter. At a 30% cut for servicing each policy and NO RISK, this is a huge win for your friendly insurance agent.
Biggert, R-Ill, the sponsor of the House bill, went down the list of influential supporters:
American Insurance Association, American Land Title Association, Building Owners and Management Association, CCIM Institute, Chamber SWLA, Council of Insurer Agents and Brokers, The Financial Services Roundtable, Independent Insurance Agents and Brokers of America, Institute of Real Estate Management, International Council of Shopping Centers, Manufactured Housing Institute, Mortgage Bankers Association, National Association of Home Builders, National Association of Mutual Insurance Companies, National Association of REALTORS, National Ready Mix Concrete Association, and the U.S. Chamber of Commerce.
That’s because their intellingent enough to see that every time a “proposed” rate increase goes through, you have a MS or FL lawsuit to block it that is upheld, if it even gets passed in the 1st place.
Any rate inadequacy in the current version of this gov’t-owned system is passed directly to the tax-payer. The primary issue with Gov’t sponsered plans is their not responsive enough to true market forces that will subject them to higher & higher losses. The premise of an Insurer’s capital (& the state’s regulation of it’s solvency) is the ability to cover “FUTURE” losses. This means that they have to estimate what money will be needed for future losses and be ready to be proactive, not reactive.
The surpluses in this capital pool are put back into the economy through investments. this is a much better (& time-tested) model than never having more than 20-30% of what you need, then taxing for as much as you can to make up the difference, and then printing money to cover what you can’t tax for or borrow.
30% cut!! That would be nice if it were true. Not even close. You are partly right, however…it is a service fee for having the proper knowledge of what to do & how to do it correctly. Probably unlike whatever it is that you do.
After meeting with the Pinellas County Property Appraiser on Thursday and examining the FIRM maps and the new flood insurance rate tables, it is apparent that many peoples’ flood insurance will go up, and a few will go down. The issue is where the home’s “top of floor” is in relation to the 100 year flood plain level shown on the FIRM map. If a property is at the current FEMA FIRM flood level, then the premiums should stay close to the same. If the T.O.F. is above the flood level it should go down, and if the T.O.F. is below the flood level, the more feet T.O.F. is below the flood level, the higher the premium will be. Most of the affected properties in Florida that will be hit with big increases were built before the current National Flood Insurance Program (NFIP) and are “slab on grade” or only sightly elevated above grade. Also, some of the affected home owners do NOT live on the water. Any low area is affected, including may modestly priced homes that happen to be build on low ground in an “A” zone. All new developments built in a flood zone must be elevated. That has been true since at least the mid-’80s, but FEMA keeps revising and raising the levels, so some homes built in the ’80s and ’90s that met code then don’t now.
As an agent, even if I know about pending flood rate increases I won’t know for sure until they have been published. Even then, that will only tell me the new rates for about a year. Anyone that is on a retirement income should not be purchasing a home in either a flood zone or hurricane area anyway – unless they have very substantial amounts of extra income. If someone knows that their home is already in a flood zone or near a flood zone they should either plan for large increases in the price of insurance or don’t buy there. Unfortunately some greedy real estate agents and investors are not going to inform buyers about anything that might scare them away. Many of these new flood zones have been created by over development which causes short term runoff flooding when rain falls on concrete rather than bare ground. Flood rates have been subsidized by the government for far too long.
If one subsidy goes…all should go, includiong crop insurance.
And obamacare too. That is a big subsidy.
If you really want to fight (section 205) of Biggert-Waters go to your US Congressmen and ask them why they would support raising homeowner rates and at the same time condone these unjustified LOMR approvals? It’s a good question that deserves an answer.
Alabama Senator Richard Shelby is the road block. He adamantly defends section 205 of Biggert-Waters and will not budge. It’s really hard to understand when he claims that making the NFIP actuarially sound is a priority yet, he does nothing to prevent unjustified rate decreases for gulf front condominium buildings in his own state. Obviously individual homeowners and small businesses are expected to make it up.
In the past five years a company out of South Florida, Flood Zone Corrections, started submitting Letters of Map Revision (LOMR) applications on gulf and ocean front condominium buildings along the Florida and Alabama coastline. Many of the buildings had sustained major flood damage from hurricanes and some were actually in the NFIP Repetitive Loss Program. Even with these facts available, FEMA officials determined these water front buildings were not in velocity flood zones. The buildings were rezoned and premiums have been reduced by an average of over 90%.
Now US Legislators and FEMA officials have decided to implement (section 205) of the Biggert-Waters Act in an attempt to make the program more actuarially sound. Thousands of homeowners and small businesses will see massive rate increases on their National Flood Insurance Program (NFIP) policies. How can Legislators and FEMA officials justify this action when they gave ridiculous unjustified rate decreases to condominium owners with the highest risk of flood loss? Homeowners and small businesses should not be unjustifiably penalized. This is not how you make the NFIP program actuarially sound.
Over the past couple of years the federal government has paid billions of dollars in federal assistance for properties that don’t carry flood insurance. We’ve seen it in New Jersey, Tennessee and this year Colorado. The easiest way to make the program actuarially sound would be for the federal government to required flood insurance on any property that had a federally backed loan regardless of where it’s located. Everyone would pay for their actual risk. The fact is flooding happens everywhere and it can’t be predicted.
Politicians are reactive not proactive and it appears they only react when an issue affects votes. The approval of LOMR’s on these repetitive loss and ocean/gulf front condominium buildings shows that making the NFIP actuarially sound was never a priority for any US Legislator or NFIP official until they saw an opportunity to capitalize off Biggert-Waters. Yes, affected homeowners and small businesses will be upset with them but they know the vast majority of voters think people living on waterfront coastlines are rich and they deserve to pay these tremendous rate increases. Most of these people are not rich and many will lose their homes due to Biggert-Waters.
FACT: According to the current FEMA flood maps, in Orange Beach and Gulf Shores, Alabama, there are 77 condominium buildings located in “V” flood zones on the gulf front. Over the past three years 71 of those 77 buildings have been approved for LOMR’s. One of the requirements of getting a LOMR approved is the community must concur with the revision. In Orange Beach and Gulf Shores the flood plain managers disagreed with the LOMR’s and, in every case, declined to sign concurrence letters. The flood plain managers knew these buildings had suffered flood losses during Hurricanes Erin and Opal in 1995, Hurricane Danny in 1997, Hurricane Georges’ in 1998 and Hurricane Ivan in 2004. What’s really amazing is FEMA had already placed at least ten of these buildings in the NFIP Repetitive Loss Program. Although these buildings have received millions of dollars in flood claims, FEMA officials decided they should not be in high risk flood zones. The approval of these LOMR’s allowed the condominium buildings to be moved from “V” flood zones to less hazardous “A” flood zones. The annual premiums were reduced by over 90% and the annual revenue loss to the NFIP is over $5MM. All of this is happening within a program that’s operating at a deficit of over $25 billion.
There is a way to help subsidize flood rates. The Federal government could require every home owners policy cover flood. Like stated, flood can happen anywhere. So why should some home owners get away without buying flood insurance because they live away from the coast, but as soon as a flood hits them, the government bails them out? If everyone had the coverage, and every carrier had to supply it, rates would go up, but the people in low flood zone areas would pay little, but still something to go into the fund. Even here in Phoenix, AZ we can have flooding but most of us are not in a flood zone and most of us will never be affected. However, even if all three million of us, well lets say 1,000,000 homes, pay $50 more a year, that’s $50,000,000 from one city. Of course people in high flood zones would still have to pay more, but maybe not $12,000 more, but maybe only $5,000 a year. Sounds to me like a win win. I wouldn’t have a problem paying an extra $50 a year, plus I’ll have the peace of mind of having flood insurance incase CAL floats away. LOL
Eventually, You have to pay for what you get and for too long the rest of us have been subsidizing their ocean front view. Global climate change is going to wake lots of people up and they will soon realize that it s a reality.
Terry, I agree. You do “have to pay for what you get”. But I can’t really trust that these new rates are the true, actuarially sound rates when I hear about increases from $1000 to $12,000. What are the credentials of these people that develop these rates? Are they the same people that help determine high risk vs low risk zones? If so, I don’t have much confidence in them. FEMA data states that 27% of all flood claims occur in low risk zones. That doesn’t sound like FEMA’s very accurate with the low risk vs high risk determinations.
I’m not sure the “ocean front view” has been the majority of the problem. Flooding has occured in the Mid-West, Nashville, and many other places. We’ve all paid for this.
Do your research. This is affecting a lot more than people on the beach. There are people miles inland from me (on the beach) with modest homes who are going to see their flood insurance go through the roof, to say nothing about the value of their homes going down because nobody wants to pay the insurance. I personally know 4 realtors that have told me that they have lost a combined total of over 30 deals just in the past 2 weeks. You thought the recession was bad, look out for this one. Think of everyone even NEAR water (lakes, rivers, even retention ponds). Every state has SOME water. How about Mississippi with the river, Missouri with theirs, to say nothing about Minnesota and other states. 100 year flood plains are affected also, so even if someone hasn’t had a flood in 50 years it won’t matter, their insurance is going to go up.
So, you’re on a barrier island in a proven hurricane/flood area, and you wonder why your flood insurance is ONLY $1,000 a month? We are supposed to continue subsidizing people who continue to buy/build in flood zones? Wow…..
Typical response (Carson) from someone who wants something for nothing and wants hard-working people to suffer. Continue to penalized those that have worked hard all their lives to afford a nice second home – yeah right! You haven’t subsidized anything! Instead of throwing a barb at these folks how about sympathizing with their plight. They played by the rules and were betrayed by their Realtor and their government.
::rolls eyes::
We are much too busy sparing no expense (and inventing plenty that don’t even exist) to fight Wars on Nouns that we will never win but continue to wage. We have allowed our so-called leaders to gut program after program that built this country, and we continue to do nothing as they sell off the rest, from school systems to the postal service to our highway and bridge infrastructure to our prisons and water systems. One day, the curtain will drop, and we will all turn around and find a brick wall in place of exits.
You know it’s sad but true.
I’m not rich, but doing OK and have planned pretty well (I’m told) for retirement. But Guess what? My plans don’t involve buying a beach house in a hurricane/flood zone!
Good grief. The land of the free & home of the brave has become the “I want what I want, and you have to help me get it” land.
I’m shocked by the amount of people who dont know that a lot of homes in the flood zone arent on the beach. Flooding just occurred in Colorado is that state on the beach? And guess what it didnt only affect the reach people.
How many “barrier island getaways” have been rebuilt by the taxpayers several times in the past 40 years. It is time to take a hard look at all of he property built in high risk (flood, storm, fire, etc) areas and turn some of the subsidized costs back on the buyers and developers. This includes homes in the middle of Colorado and Montana forests as well as beach homes in Florida.
Bob’s comment about crop insurance is on the mark (or should that be the money). The crop insurance program was developed to protect the family farmer, not giat corporations, hedge funds and foreign investors.
Funny how all of these complaints are about Hurricane/Flood zones and yet look at the last 5 years and tell me where all the flood claims have originated. Other than Hurricane Sandy- most are not anywhere close to the coast. Love how the government is wanting to change a subsidized program that has been around for over 40 years and yet they start another subsided program with the Affordable Health Care Act. Thats the kind of logic only found when the government on any level is involved. There are much better ways to ensure the solvency of the flood program- like adding a $100.00 to all homeowners policy in the US. I would start there.
No.
What state you live in jw? Hope its not one that has a catastophe.
If I took the time to evaluate the likelyhood of floods before I bought my house, why can’t anyone else?
Yes, there are disasters and floods in my state. I don’t think giving the federal government more money is the right answer, no matter who’s giving the money. I espeically don’t agree with charging ALL homeowners.
I just got a check from United Health Care reimbursing me for over $300 because of the Affordable Health Care Act and the fact they can’t gouge us without reason and keep the money.
Rates should be based on potential risk and exposures. I agree with InsGuy above.
Also, I am in Tn and regarding gov’t bailouts of flooded areas, in the early 1970s we were flooded in Chattanooga. There were no gov’t bailout/handouts. What the gov’t did offer was low interest loans to fund repairs not paid for by insurance. We were very grateful for the assistance, and paid back the loans with interest, at no net cost to other taxpayers. In 1970, no one would have expected the handouts which are the norm today.
How times change. Not always for the good, it seems.
You are not referencing the devastating Cumberland River flooding in 2011. There is a world of difference between the people, the businesses and the attitudes of the TN residents affected by THAT flood and the NY’ers and NJ’ers (still whining with their hands out) of superstorm sandy.
The only question I have is how can you purchase a $600,000 home in the beach and not have $12,000 to spend yearly on flood insurance?! It would be like purchasing a BMW M5 and saying you can’t afford premium gas.
Also, why in the world was it their P&C agent’s responsibility to “tell them of the impending flood rate changes”?! It would be like blaming the dealership you bought an M5 from for not telling you that the price of premium gas would increase.
Tsk, tsk, this self-entitlement mentally and lack of self accountability is just incredible.
I agree. If anyone dropped the ball on this it is these folks own real estate agent. A quality real estate agent is going to have a handle on anything that may impact the market and home prices. Their real estate agent should have been aware and informed them of the possibility of an insurance rate increase. Oh, wait, the real estate agent was probably focused on the commission.
Re your comment about purchasing a $600,000 home (and also a BMW M5), unfortunately most folks don’t look at the price of a house/car, they only look at the payment they can afford. In actuality, these folks can’t afford a $600,000 home.
whom do you think approves these developments and why? That’s right your local government does to increase tax revenues.
No point in debating this issue on insurancejournal.com. This is not a neutral audience. The insurance industry stands to gain the most from this and was it’s primary supporter. At a 30% cut for servicing each policy and NO RISK, this is a huge win for your friendly insurance agent.
Biggert, R-Ill, the sponsor of the House bill, went down the list of influential supporters:
American Insurance Association, American Land Title Association, Building Owners and Management Association, CCIM Institute, Chamber SWLA, Council of Insurer Agents and Brokers, The Financial Services Roundtable, Independent Insurance Agents and Brokers of America, Institute of Real Estate Management, International Council of Shopping Centers, Manufactured Housing Institute, Mortgage Bankers Association, National Association of Home Builders, National Association of Mutual Insurance Companies, National Association of REALTORS, National Ready Mix Concrete Association, and the U.S. Chamber of Commerce.
That’s because their intellingent enough to see that every time a “proposed” rate increase goes through, you have a MS or FL lawsuit to block it that is upheld, if it even gets passed in the 1st place.
Any rate inadequacy in the current version of this gov’t-owned system is passed directly to the tax-payer. The primary issue with Gov’t sponsered plans is their not responsive enough to true market forces that will subject them to higher & higher losses. The premise of an Insurer’s capital (& the state’s regulation of it’s solvency) is the ability to cover “FUTURE” losses. This means that they have to estimate what money will be needed for future losses and be ready to be proactive, not reactive.
The surpluses in this capital pool are put back into the economy through investments. this is a much better (& time-tested) model than never having more than 20-30% of what you need, then taxing for as much as you can to make up the difference, and then printing money to cover what you can’t tax for or borrow.
30% cut!! That would be nice if it were true. Not even close. You are partly right, however…it is a service fee for having the proper knowledge of what to do & how to do it correctly. Probably unlike whatever it is that you do.
Methinks that you are confusing “your friendly insurance agent” for the servicing insurance company. 30%?
After meeting with the Pinellas County Property Appraiser on Thursday and examining the FIRM maps and the new flood insurance rate tables, it is apparent that many peoples’ flood insurance will go up, and a few will go down. The issue is where the home’s “top of floor” is in relation to the 100 year flood plain level shown on the FIRM map. If a property is at the current FEMA FIRM flood level, then the premiums should stay close to the same. If the T.O.F. is above the flood level it should go down, and if the T.O.F. is below the flood level, the more feet T.O.F. is below the flood level, the higher the premium will be. Most of the affected properties in Florida that will be hit with big increases were built before the current National Flood Insurance Program (NFIP) and are “slab on grade” or only sightly elevated above grade. Also, some of the affected home owners do NOT live on the water. Any low area is affected, including may modestly priced homes that happen to be build on low ground in an “A” zone. All new developments built in a flood zone must be elevated. That has been true since at least the mid-’80s, but FEMA keeps revising and raising the levels, so some homes built in the ’80s and ’90s that met code then don’t now.
State Flood Pools, like windstorm association, is probably the best solution.
It certainly makes more sense than a federal plan.
As an agent, even if I know about pending flood rate increases I won’t know for sure until they have been published. Even then, that will only tell me the new rates for about a year. Anyone that is on a retirement income should not be purchasing a home in either a flood zone or hurricane area anyway – unless they have very substantial amounts of extra income. If someone knows that their home is already in a flood zone or near a flood zone they should either plan for large increases in the price of insurance or don’t buy there. Unfortunately some greedy real estate agents and investors are not going to inform buyers about anything that might scare them away. Many of these new flood zones have been created by over development which causes short term runoff flooding when rain falls on concrete rather than bare ground. Flood rates have been subsidized by the government for far too long.