Federal insurance program could be more harm than help to homeowners
The National Flood Insurance Program in the U.S. has come under fire once again. Senator Bob Menendez has said that the federal program is “stacked against homeowners” that attempt to file claims in the wake of major natural disasters. Following 2012’s Hurricane Sandy, many homeowners in New York and New Jersey were left without financial aid because of the faults of the federal insurance program. Some of these homeowners had flood protection, but had to wait for months before their claims were processed, and longer still before they received the money from their claims.
Senator denounces inadequacies of federal program
Senator Menendez suggests that the insurance companies that provide the National Flood Insurance Program with policies have “perverse” incentives to underpay claims. The Senator has also accused the Federal Emergency Management Agency, which oversees the federal insurance program, of meeting a deadline set by Congress to address appeals of rejected claims. Some of the claims associated with Hurricane Sandy were rejected due to technicalities, leaving policyholders without any kind of support.
Effects of Hurricane Sandy are still being felt
Almost two years after Hurricane Sandy, the effects of the powerful storm are still being felt. This may be due to the faults of the federal insurance program, which has been crippled by debt for nearly a decade. The program’s financial and structural problems have prevented it from properly serving homeowners and handling claims in an effective manner. All the while, insurance premiums continue to rise as FEMA revises flood maps and looks for ways to make the federal program financially stable.
Some states look into privatizing flood insurance
Congress has already taken action on the National Flood Insurance Program, setting a limit on how much premiums can be increased in a single year. Federal lawmakers may be preparing to take more decisive action on the matter in the near future. Some states are so opposed to the National Flood Insurance Program that they are beginning to look into opening up their flood markets to private companies that wish to provide insurance coverage.