FEMA memo highlights an increase in insurance rates for non-primary homes
Flood insurance rates on non-primary homes are set to rise by a significant margin next year. Policies for old, primary homes are expected to have their rates increase by an average of 15% after April 1, 2015, but non-primary homes could see rates spike by 37% on average, according to a recent memo from the Federal Emergency Management Agency (FEMA). The federal agency manages the National Flood Insurance Program, which is the only place many homeowners can find insurance coverage for their properties.
Federal law offers limited protection to vacation and rental properties
The issue of flood insurance costs have become a political matter. As insurance policies began to rise at a quick pace, many homeowners had expressed their concerns over costs. Federal lawmakers had taken action on the matter, passing the Homeowner Flood Insurance Affordability Act, which protected some primary homes from major rate increases. The problem, however, is that the legislation provided little protection to non-primary homes. As a result, owners of vacation homes and rental properties are likely to see higher rates for their insurance coverage in the coming year.
_________________________Random Success Quotes to Remember ~ "Great minds discuss ideas; average minds discuss events; small minds discuss people." -- Eleanor Roosevelt
Owners of non-primary homes will also pay a surcharge on their insurance coverage
Those with non-primary homes will also face a $250 surcharge on their insurance policies next year. This surcharge is meant to provide some financial stability to the National Flood Insurance Program, which has been having money issues in recent years. In the wake of powerful natural disasters, the federal program has fought to remain financially stable and continue providing coverage to homeowners and those that are seeking protection against flood damage.
Changes to flood maps have made insurance coverage more expensive for some homeowners
FEMA has been making changes to its flood maps recently. These flood maps are used to identify properties that are located in risk-prone areas of the country. The maps also play a role in pricing flood insurance coverage for homeowners. As flood maps have changes, those that had not be inn flood-prone areas in the past have found themselves in these areas, which means that they have had to pay more for their insurance coverage overall.