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Spike in flood insurance rates

November 1, 2013

Tom Rishel is a small business owner in Muncy with several properties he had hoped to one day sell....

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Nov-03-13 11:39 AM

I am appalled!!..Why didn't Me Marino research this??!! We are senior citizens and are in the process of looking for a smaller one level home..But scratch that now since we live on the fringe of the flood plain in Muncy..who will buy our house if they know they will have to pay over $9,000 a year for flood insurance?!..these houses will eventually just sit here vacant and the city will have to tear them down...or is that the goal? much for moving to a one level home that we both need due to some health issues...

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Nov-03-13 4:17 AM

bsquared, I'm sure they had no idea 20 years ago that their property taxes and homeowners insurance would raise so much either, but they did. Sorry, but I don't feel it necessary for the rest of us to subsidize the premiums of flood insurance for those who chose/choose to live in a flood plain. It's the gamble they took. There was never any guarantee that flood insurance rates would never go up or that there wouldn't be a rate spike.

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Nov-02-13 7:12 PM

mr kerstetter, if property owners would have known that their insurance rates were going to be what they are now I am sure that they would chosen to buy elsewhere.

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Nov-02-13 8:07 AM

Seems like Big Government is trying to turn everyone into the poverty economic group...when will it all stop!

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Nov-02-13 8:04 AM

What!... Mr Marino! you say a do over?

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Nov-02-13 6:00 AM

bsquared, lending institutions that are federally insured or loans that are federally regulated (like FHA) are required to have flood insurance if they are in 'high risk' flood areas. The purpose of requiring flood insurance is the same as the requirement to carry homeowners insurance; to protect the bank (and the FDIC/NCUA/any other agency who backs them) from loss in case something happens to the home because the lending institutions carry most of the risk when a property is mortgaged.

Yes, the federal government may have been subsidizing the flood insurance. If that is the case, why are we, the taxpayers, paying the insurance premium for those who choose to live in the flood zone?

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Nov-02-13 3:07 AM

I know Tom, and know of one of his houses that had water AROUND it in 72. For floodwater to go above Water St in Muncy, as happened in 72, was a shock to residents.

I was born and raised in Muncy and lived through MANY floods. In 72, my mother had water on her second floor, something that had not happened previously......even in 1936.

I know senior citizens who have lived in their homes for 40-50 years. This is going to hit them especially hard.

My big question is, how about the wild fires and mud slides in California? Billions is spent on them year after year after year. And they just keep rebuilding on the same land.

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Nov-01-13 10:25 PM

I disagree with the comment equating subsidized insurance to welfare. If you own a home you are contributing to your local community by paying real estate and school taxes. The government makes the banks make you carry insurance and was just giving a discount on it.

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Nov-01-13 6:34 PM

You mean the legislatures passed a bill without input from the people who voted for them no way this could've ever happened and ps excuse me Justin but I don't believe the welfare people are at least bit for any republicans as they the republicans are the ones the welfarians always blame for axing their free ticket

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Nov-01-13 4:11 PM

Mikekerstetter, 35 years ago I purchased my home in Muncy before all this flood zone s... was in place. About 8 years ago my loan was sold to some of the other gangsters and all the sudden I needed flood insurance, so I complied costing me about 400 a year since my mortgage was almost paid for. Recently I did a reverse mortgage, yep they wanted flood insurance for 90000, ok how much, now we are talking 980, still no problem, a year later my bill comes for flood insurance for 1100.00 seems they have the authority to raise it each year up to 20% according to the letter I got. So I go online for a FEMA LOMA (letter of map admendment) of course I need an elevation certificate, cost $500 for the surveyor! Last week I get a call from the bank saying my flood insurance only covers the loan and should be the replacement value which IMHO is bull as is my homeowners policy. Yesterday I got my LOMA and my property is 1% flood plan and has been removed from the hazard zone.

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Nov-01-13 2:45 PM

Justin1, best comment ever, thank you.

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Nov-01-13 12:38 PM

The National Flood Insurance Program is a revenue stream. They need the premiums coming in. Just as in Obamacare, those paying the higher premiums are footing the bill for those homeowners (such as those buying under HUD)that can't afford the Flood Insurance and qualify for subsidies. My suggestion is to shop with Insurance carriers and see who has a more affordable rate. You may be pleasantly surprised.

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Nov-01-13 11:25 AM

You are right dannygirl about the mortgage requirements. I will amend my comment to those who don't have a mortgage will consider dropping the insurance.

However, flood insurance does cover contents.

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Nov-01-13 10:58 AM

Dannygirl- flood insurance does not cover contents in basement, but it does cover contents in living areas.

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Nov-01-13 10:52 AM

Johnny the problem is that if you have a morgage on a house the bank requires you to carry flood insurance if your property is located in a flood plain. I recently talked to a insurance agent and he told me that the banks previously only requried you to carry insurance to cover the amount of the loan but many now are requiring you to carry the replacement value of the home. So you may only owe $70,000 on the home but to rebuild that home may cost $200,000 so that is what the banks are requiring in flood insurance. Also the flood insurance only covers the structure and you have to buy an additional policy to insure your contants as home owners does not cover flood damage and flood insurance does not cover contents. This is even for homes that have never had a flood claim.

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Nov-01-13 9:41 AM

If the price goes up to $10K per year like the guy from Muncy, a lot of people, not all, will consider the odds. How likely is it they will be hit with an Agnes or a Lee? I think most will drop their insurance. Think about it, if they go 10 years without damage, that's $100K they didn't spend on a $70K house that due to the flood insurance may drop in value to $40K.

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Nov-01-13 9:32 AM

So let me get this straight. According to Marino, "The Biggert-Waters Flood Insurance Reform Act, while not ideal, was the only option for making the National Flood Insurance Program viable for the future,". I would tend to disagree for a number of reasons. 1. The FED prints money by the billions each month to give as a kickback to the TBTF Banks on Wall Street, which we the taxpayers pay the interest on. 2. We could bail out the major Banks of Wall Street, who not only caused the problems for why they were initially bailed out and have been the major source as to why we are in such economic straights today. 3. But we do not have the funds to help the little guy with his flood insurance. "Why should the Government be in the business of subsidizing someone's flood insurance?" Why not, we subsidze everything else including big business constantly. So why not subsidize the little guy for a change.

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Nov-01-13 9:10 AM

Let me guess, these folks complaining about losing their government subsidized insurance are the same people who hate welfare programs and obamacare. Tea partiers love to hate the government until they realize that the government gave them benefits too! I guess you could just raise everyone's taxes to pay for your subsidy to live in a river plain. Problem solved.

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Nov-01-13 8:18 AM

Some things never change...

The Mob/Mafia 3 most profitable sources of income....

Protection aka Insurance.


Alcohol & Drugs.


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Nov-01-13 5:57 AM

Another issue of concern is how is the determination made as to where is the flood plan elevation is. Even after Agnes in 72, there were a lot of guesses and interpolations made by agencies as to how high the water actually went. Some of the maps were wrong.

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Nov-01-13 4:05 AM

Why should the Government be in the business of subsidizing someone's flood insurance? It isn't like any of these people didn't know they were buying a home in a flood zone and needed flood insurance for their mortgages.

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Nov-01-13 1:30 AM

Just like Dumbamacare.....another bill passed without the necessary research on consequences.

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