Flood insurance rates set to soar in the US
Hundreds of thousands of homeowners throughout the U.S. are bracing for the impact of higher flood insurance rates as the Federal Emergency Management Agency (FEMA) makes sweeping revisions to its flood maps and federal lawmakers seek to introduce further reforms to the National Flood Insurance Program. FEMA has been slow to revise its flood maps; so much of the concern among homeowners is related to reforms that were passed last year concerning the federal flood insurance program. These reforms are scheduled to go active within the coming months, thus sparking a major increase in insurance coverage rates.
Reforms aim to fix problems associated with federal program
The National Flood Insurance Program has been in financial distress for some time. The program accounts for the vast majority of flood insurance policies in the U.S. and is typically the only place such coverage can be found within the country. Private insurers are not eager to provide this type of coverage due to the financial risks that it represents, especially in states where homeowners often fall victims to hurricanes and similar natural disasters. These financial risks have routinely proven to be valid given the current financial state of the federal program. Federal lawmakers introduced major reforms to the program in 2012 in order to address its various issues.
New measure could provide some homeowners with protection against higher rates
Various provisions, such as one that increases the flood insurance rates on second homes by no less than 25%, are expected to go active by October of this year. Federal lawmakers believe that these reforms will be beneficial for the federal program, but homeowners throughout the country have begun to protest such drastic increases in rates. A new measure has begun to win support in the Senate largely due to the demands coming from these homeowners.
Measure manages to gain support thanks to protesting homeowners
The measure would provide homeowners throughout the country a one-year reprieve concerning the reforms introduced to the National Flood Insurance Program. This would primarily benefit those with older homes, but newer homes could also benefit from the measure’s protection against higher rates depending on where they are located. Some businesses may also receive a reprieve from the federal program’s provisions thanks to the measure introduced to the Senate earlier this week.