Where Harvey is hitting hardest, 80 percent lack flood insurance

Gladys Abbott
September 3, 2017

Hurricane Harvey is an unprecedented flood event. At least in the United States, there is a government-backed program that provides flood insurance to residents. Now, the first time many people learn that their new homes are flood-prone is the first time they see their living room underwater.

The federally-funded program, which is part of FEMA, is the only protection against flooding that most homeowners and businesses can hope to get, since private policies typically only cover the wind damage that's associated with hurricanes, but not flood damage. "The only question is whether it is a short or long term solution".

The number of policies in force today has fallen in 43 of the 50 states since 2012, dropping from nearly 5.5 million to just under 5 million, a decrease of 10 percent, AP's analysis found. Now increases are limited to 18 to 25 percent, depending on the property. Yet, Texans must know that the clock is ticking on their insurance claims, and filing a claim after today could cost them.

But rather than extend the program to additional at-risk properties, Congress may be inclined to restrict it, particularly for high-risk properties that have been flooded repeatedly.

Florida, with more than 1.7 million flood insurance policies, has 35 percent of the 5 million policies covered by the federal program.

That is definitely the case whenever Congress talks about reforming the costly Social Security, Medicare and Medicaid programs. "These numbers start to give you a sense of how many homeowners in the area won't have coverage for most of the damage to their homes".

The obstacles set up in the law, meant to quell lawsuit abuse, came to be called the "Blue Tarp law" by its opponents, using the imagery of FEMA-supplied blue tarps that covered gaping holes in roofs after hurricanes like Rita and Ike.

"There is certainly a desire inside FEMA to modernize how the [flood insurance program] is run", Stander said.

Several Houston-area homeowners and insurance experts also attributed the decreased coverage to tight family finances in recent years due to the drop in oil prices and the region's reliance on that industry.

More news: President and First Lady Meet With Hurricane Harvey Victims

In the Senate, political opposites such Marco Rubio of Florida and Elizabeth Warren of MA are supporting a NFIP reauthorization bill.

Federal flood insurance payouts and other disaster relief are not just another form of political pork sent home, like highway dollars fixing potholes. They spent the night on flattened boxes, wondering how much damage their house sustained.

"There was always an intent to reauthorize the program", said Chris Gillott, legislative director for Sen. But with Houston having experienced its third so-called "500-year" flood in three years, it's obvious that it's not a risk worth taking.

"I'm not going to be able to stop the flood".

FEMA flood maps in Miami-Dade County are scheduled to be redrawn in 2019.

The Hartzes had flood insurance, but the home also had a detached garage that was not covered under their policy.

We are concerned that the package will make flood insurance unaffordable for our constituents, will stall development and construction, and increase exposure to the Federal Treasury. For homeowners in high-risk areas it could become too expensive and out of reach. Over the last decade, these groups have lobbied to phase out subsidies for flood insurance and institute other reforms. Nominate a worthy colleague for the Insurance Business Awards!

But even though the premiums are effectively subsidized by the government, most people choose not to take out flood insurance, especially those who live in areas not generally considered flood-prone. Many homeowners let the policy lapse after a few years, correctly thinking the bank will not check.

"That is all fine and good", said Jimi Grande, senior vice president of government affairs for the National Association of Mutual Insurance Companies.

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