National Flood Insurance up for Renewal in September, 2017
Posted 05-08-2017 at 04:34 PM by Sunshine Rules
The National Flood Insurance Program (NFIP) will be up for renewal yet again, in September.
The program is $24 billion in debt and members of Congress are again saying something has to be done to address the deficit. They have been considering how to get the private insurance companies to participate more in the flood insurance market. However, most private insurance companies will not get involved as long as many of the flood insurance rates being charged are subsidized under the current NFIP.
The last time Congress tried to change the program in 2012 to make the rates less subsidized, more actual market rates, many homeowners carrying flood insurance in high risk areas had sticker shock. Some older homes on Anna Maria Island saw flood insurance rates go up to over $14,000 a year.
Which lead to yet another revision of the program in 2014 and more subsidized flood insurance rates -- although with the option for rates to be raised each year (with an annual cap on increases) until they reached market rates.
As a home buyer, I would tread carefully before buying a home in a flood zone this year, especially one built pre-FIRM (before the 1974 flood insurance rate maps were established), as those older homes in flood zones have benefited from subsidized flood insurance premiums.
What new reforms to the NFIP coming in September is, at this point, anyone's guess.
The program is $24 billion in debt and members of Congress are again saying something has to be done to address the deficit. They have been considering how to get the private insurance companies to participate more in the flood insurance market. However, most private insurance companies will not get involved as long as many of the flood insurance rates being charged are subsidized under the current NFIP.
The last time Congress tried to change the program in 2012 to make the rates less subsidized, more actual market rates, many homeowners carrying flood insurance in high risk areas had sticker shock. Some older homes on Anna Maria Island saw flood insurance rates go up to over $14,000 a year.
Which lead to yet another revision of the program in 2014 and more subsidized flood insurance rates -- although with the option for rates to be raised each year (with an annual cap on increases) until they reached market rates.
As a home buyer, I would tread carefully before buying a home in a flood zone this year, especially one built pre-FIRM (before the 1974 flood insurance rate maps were established), as those older homes in flood zones have benefited from subsidized flood insurance premiums.
What new reforms to the NFIP coming in September is, at this point, anyone's guess.
