Sep 18
Flood Insurance
This may come as a considerable surprise to you, but in 1968 the U.S. Congress passed and the President signed into law the National Flood Insurance Program. This law has many components, defining flood plains and safe construction areas – but its primary component is the provision of flood insurance for people who DO live in potentially endangered areas.
The law provides that if communities will agree to participate in federal guidelines regarding construction in flood zones, the government will, in return, provide flood insurance – for a reasonable premium – to people in those communities who live in potential flood zones. The law was amended in 1978 to expand coverage and amended again in 2004 to allow commercial insurance firms to write these federally supported flood insurance policies for homeowners. These policies are called WYOs, or Write Your Own flood insurance, ensuring a relatively convenient method for homeowners to obtain flood insurance through their broker instead of wrestling with the federal bureaucracy. Bush also placed this program under the control of FEMA in the amendment he signed in 2004.
All of this judicious behavior in Washington over the last thirty five plus years leads one to puzzlement over the lack of flood insurance coverage for the victims of Katrina, and the unavailability of flood insurance in many communities today. You can check the list of the 20,000 participating communities in the program and there’s New Orleans, both the City and the Parish. Most puzzling of all is the fact that in all the news coverage of this American disaster, there has been no mention of a federally mandated flood insurance program. Are we still in Kansas, Dorothy?
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April 18th, 2007 at 9:38 pm
This is a prescient topic for New Englanders this week, as we have felt the brunt of a wicked Nor’Easter storm (nothing approaching Hurricane Katrina, mind, but still quite destructive).
Homeowners insurance has saved our bacon at my house, as a quarter of our roof was blown off on Monday (!), and the upstairs is a soggy mess. However, we live up on a hill, and we have been spared the flooding that has hit so many in our community. How is it that our neighbors were told that they could not purchase flood insurance? Is it strictly a community decision at the local government level, or can a private company begin marketing WYOs for individuals who agree to construct according to the federal guidelines? Thanks for the information, great post.