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Question About Flood Insurance Rate Hikes
Posted on 7/16/13 at 6:27 pm
Posted on 7/16/13 at 6:27 pm
I just watched an editorial by Clancy Dubose about the Congressional meetings today to delay the rate hikes. My question is not really about the timing or politics of the rate hikes.
Mr. Dubose said that the rate hikes came about after Congress voted to force the flood insurance program to become sustainable, which I agree with.
I know some residents were facing flood insurance rates that would cost $25,000/yr., which does seem ridiculous. But, wouldn't a fiscally conservative person want (in theory) the rates to reflect the property's actual risk, or flood zone?
As a resident of south LA, for personal reasons I obviously want our flood rates to stay as low as possible. But as a fiscal conservative, I feel like we need to pay rates that accurately reflect our risk.
Does anyone feel like we need to rethink support of insuring properties if the risk really would warrant 25k / yr insurance?
Mr. Dubose said that the rate hikes came about after Congress voted to force the flood insurance program to become sustainable, which I agree with.
I know some residents were facing flood insurance rates that would cost $25,000/yr., which does seem ridiculous. But, wouldn't a fiscally conservative person want (in theory) the rates to reflect the property's actual risk, or flood zone?
As a resident of south LA, for personal reasons I obviously want our flood rates to stay as low as possible. But as a fiscal conservative, I feel like we need to pay rates that accurately reflect our risk.
Does anyone feel like we need to rethink support of insuring properties if the risk really would warrant 25k / yr insurance?
3
Posted on 7/16/13 at 7:45 pm to Brightside Bengal
The NFIP exists because the gubbermint said that it was not right for insurance companies to charge based on acturarial rates. The formation of the NFIP essentially meant no competition in the flood insurance industry.
Now that there is no competition, they want to charge base on the actuarial rates.
Also, keep in mind that mortgage companies require flood in the amount to cover their loan. If people would have been able to calculate their monthly note using these new actuarial rate they probably would not have bought.
To change the rules in the middle of the game hardly seems fair.
And none of this takes on the whole notion of levee protection.
Its a cluster F....
but aren't most things the govt dabbles in.
Not to mention the feds also want to tamper with the Mortgage Interest deduction.
Not good times for gulf south real estate ahead IMO
Now that there is no competition, they want to charge base on the actuarial rates.
Also, keep in mind that mortgage companies require flood in the amount to cover their loan. If people would have been able to calculate their monthly note using these new actuarial rate they probably would not have bought.
To change the rules in the middle of the game hardly seems fair.
And none of this takes on the whole notion of levee protection.
Its a cluster F....
but aren't most things the govt dabbles in.
Not to mention the feds also want to tamper with the Mortgage Interest deduction.
Not good times for gulf south real estate ahead IMO
This post was edited on 7/16/13 at 7:49 pm
Posted on 7/16/13 at 7:57 pm to MoreOrLes
Just like the mortgage interest rate deduction, the flood insurance rates should be phased out/in.
Posted on 7/16/13 at 8:00 pm to Brightside Bengal
quote:Yes, it is a form of welfare in its current state. It is true that nobody wants to lose the government programs that benefit them, but it is still hypocritical and liberal to feel that way.
But, wouldn't a fiscally conservative person want (in theory) the rates to reflect the property's actual risk, or flood zone?
Posted on 7/16/13 at 10:18 pm to Brightside Bengal
Self insure is going to be the way to do this if you don't have a mortgage.
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