Idaho homeowners who live along some lakes and rivers are finding that changes made to the National Flood Insurance Program are causing their insurance premiums to increase.
Earlier this year part of a new law, called the Biggert-Waters Insurance Reform Act, went into effect phasing out flood insurance subsidies on many older homes. In addition, the federal government has been revising its flood zone maps and reassessing the level of flood risk for various areas.
As a result, many homeowners are being required to buy flood insurance for the first time or pay higher premiums on existing policies.
In some cases premiums of less than $1,000 a year may jump to $8000 over the next five years. FEMA, which monitors the program, said premiums are expected to jump to a level that FEMA estimates to be the property’s true value of coverage.
Because of the re-mapping, an effort that took place over the past 5 years or more, some homes that were not before considered to be in a flood zone are now designated as flood zone properties.
Critics of the program say that the spike of increased rates could have been avoided if FEMA had updated its maps regularly. The previous maps were 20 years old. Map upgrading every few years would have prompted gradual rate hikes of around 5 percent.
The hikes are meant to shore up the coffers of FEMA’s federal flood insurance program which is $300 billion in debt due in part to disbursements made to property owners who fell victim to the Sandy and Katrina Hurricanes.
More information here: http://www.fema.gov/national-flood-insurance-program
-Based on wire reports