Homeowners will be paying more for their flood protection this year
Millions of homeowners in the United States could see their flood insurance rates skyrocket this year due to provisions of a relatively new legislation that have gone into effect this month. The legislation was meant to address the financial issues of the National Flood Insurance Program, which has been crippled by massive debt for some time. This year, the legislation allows flood insurance rates to increase in order to help the program recover from its financial problems.
New provisions call for an average 18% increase in flood insurance premiums
On average, rates for coverage provided by the National Flood Insurance Program will be increased by 18%. Those living in risk-prone areas of the country, however, such as coastal regions, will see their rates rise by a steeper margin. The legislation does ensure that rates will not rise by such a degree that homeowners would find themselves under heavy financial burden. Many homeowners, however, are still recovering from the impact of Hurricane Sandy, and higher flood insurance rates could place them in a dangerous financial position.
30 million homeowners may be affected by rate increase on flood protection
Some 30 million homeowners are expected to be affected by the rise in flood insurance rates. The majority of these people may not know that their premiums will be rising, however, as they often do not pay attention to issues involving flood protection. For those that are not aware the flood rates are on the rise, they may find themselves in a difficult financial situation, which may be severe enough that some people could be in danger of losing their homes due to their inability to pay their mortgage or handle other costs.
Flood insurance remains a problematic issue in the United States
Flood insurance continues to be a significant problem in the United States. The National Flood Insurance Program’s major debt issue continues to receive attention from federal lawmakers, but the government has not yet found a way to solve this problem without introducing significant rate increases to those that receive coverage through the program.