Following the struggles that have been brought about by Superstorm Sandy, higher rates could be crippling.
According to Senator Robert Menendez, choosing to increase the rates for flood insurance at the moment could be highly damaging to the residents of New York and New Jersey, who are still struggling to rebuild their homes and businesses after they were demolished by Superstorm Sandy.
The victims of the storm are already coping with the new flooding zone maps that often require changes.
The rebuilding has already led to increased costs as many of the new flood insurance zone maps have required that they build at new elevations. To add higher premiums into the mix could add expenses that those residents are simply unable to afford. Senator Menendez (D – New Jersey) said that “It is like a triple whammy”.
Several senators have joined together in the effort to delay a flood insurance rates increase.
Menendez has taken sides with Senator Charles Schumer (D – New York) as well as Senator Mary Landrieu (D – Louisiana) and David Vitter (R – Louisiana) in a proposal for the delay of a premiums increase for the National Flood Insurance Program coverage.
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This is one of a number of amendments that are being offered to the Water Resources Development Act. That bill is one addressing comprehensive water infrastructure which would provide funding to the projects of the Army Corps of Engineers, which include flooding projection plans and dredging. The Senate will likely examine this bill this week, in addition to a vote on the increase in flood insurance rates.
Landrieu first introduced the flood insurance proposal last week. It is meant to stall the increases in the premiums that would be charged for the coverage until the Federal Emergency Management Agency (FEMA) is able to hold a study regarding the affordability of the rates, and until the results of such a study can be properly examined.
Traditionally speaking, the National Flood Insurance Program (NFIP) has charged premiums to policyholders that are approximately 40 to 45 percent of what their full cost would be, with the rest being subsidized by the taxpayer.