Flood insurance rates battle now includes another state

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Mississippi has been trying to combat the federal plans to boost the price of coverage.

The intentions to increase federal flood insurance rates is currently being challenged by Mississippi, and that state is far from being alone as Louisiana, its neighbor, has now joined the others in this legal action to try to keep the cost at an affordable level.

The original lawsuit was filed by Mississippi in an attempt to stop increases at the start of October.

flood insurance ratesThe National Flood Insurance Program (NFIP) had announced that premiums for most property owners with this coverage would be increasing. Mississippi filed a lawsuit to stop the rise in those flood insurance rates that were to become effective on October 1. This has become a growing effort by the states, as a number have joined in trying to stop the skyrocketing cost of coverage against rising floodwaters.

Louisiana is now taking part in this attempt to control flood insurance rates for a while longer.

The Department of Insurance in Louisiana has now joined in Mississippi’s lawsuit against the federal government. The commissioner in that state, Jim Donelon, has now expressed that within the lawsuit, the department has now filed an “amicus curiae, or friend of the court” brief. He explained that the current increases that are being proposed under the Biggert-Waters Flood Insurance Reform Act could be catastrophic for homeowners in his state.

Back in September, Mississippi made a request from a federal judge to determine that the Federal Emergency Management Agency (FEMA) was required to provide an affordability study to Congress by April 2013. However, FEMA failed to deliver on this request. At the moment, there are approximately 17.4 million American homes located in areas where it is mandatory to have coverage against flooding. Among them, 41 percent are within median income levels, says the lawsuit’s data.

The demand made by the lawsuit is that a judge block the increases to the flood insurance rates until FEMA has conformed to the requirements of the law. FEMA has said that under the Biggert-Waters Act, its phasing out of the coverage subsidies are actually impacting less than 20 percent of the country’s total policyholders.

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