Recent storm bringing widespread flood damage have brought the issue of flood insurance into the limelight. Despite it being required in some areas prone to flooding, flood insurance is rare throughout the country. Many insurance companies do not offer such coverage because the potential for loss. Those that do offer the coverage do so at a high price, making it, in some cases, unaffordable for homeowners. Complicating matters is the ailing National Flood Insurance Program, which is meant to provide consumers with affordable access to flood insurance. The program is…
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National Flood Insurance Program takes yet another financial blow in the form of Hurricane Irene
The damage wrought by Hurricane Irene may be more than original estimated. Though the storm was not quite as powerful as has been predicted, it brought major floods to much of the East Coast. Given the scarcity of flood insurance amongst homeowners, many sought refuge from the National Flood Insurance Program (NFIP). The program has been on unsure financial footing for several months, however, being billions of dollars in debt. The program is meant to offer insurance coverage to homeowners that cannot receive such coverage through private insurance companies, yet…
Read MoreHurricane season quickly moves in while many still pick up the pieces from the last storm
The National Oceanic and Atmospheric Administration is predicting a tumultuous hurricane season this year. The forecast, released Thursday, predicts that as many as six major hurricanes could form over the Atlantic Ocean this season. This is unsettling news for many states in the south currently struggling with national disasters of their own. Insurance companies are bracing for yet more damages. Last year’s hurricane season was relatively tame. Winds kept most tropical storms at sea and prohibited them from forming into hurricanes. “However, we can’t count on luck to get us…
Read MoreWhat to expect from newly designed flood insurance program
The House Financial Services Committee unanimously approved to extend the National Flood Insurance Program (NFIP) for another five years. Financial reforms will also be established in an attempt to get the debt burdened program back on solid financial ground. The NFIP was created by Congress in 1968. It was intended to provide an insurance alternative to disaster assistance, to help meet skyrocketing costs of repair and replacement of homes and contents damaged by floods. As of last year, more than 5.5 million homes were insured by the NFIP. The National…
Read MoreInsurance companies jockey for position over State Farm’s abandoned flood policies
The U.S. House of Representatives have passed reform legislation for the National Flood Insurance Program (NFIP) despite distractions from numerous insurers. State Farm Insurance Company dropped out of the government program last year, leaving over 800,000 policies in the government’s hands. The government’s NFIP covers more than 5.6 million property owners from common natural disasters as well as flooding. State Farm leaving the program marks the largest withdrawal from the program since it began in 1969. FEMA (Federal Emergency Management Agency) runs the government program. The policies are marketed, sold…
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