A couple of representatives of the federal flood insurance program came to College of Coastal Georgia to discuss new higher rates that will be phased in coming years.
They were hit by a flood of angry people, some who said the new insurance rates would make their property unsalable and others who predicted a wave of foreclosures and a devastated real estate market because few will be able to afford flood insurance.
With the National Flood Insurance Program about $24 billion underwater from hurricanes Katrina and Sandy, Congress passed the Biggest-Waters Flood Insurance Reform Act of 2012, which eliminates subsidies to policy holders and increase rates to levels to reflect the actual risk. That will affect about 20 per cent of the policy holders, some of whom bought houses built before the insurance program even existed.
Policy holders will see 25 per cent increases in their premiums each year until the payments reach the level FEMA considers commiserate with the risk. The owners of non-residential property, such as vacation homes and commercial property, have already been hit; the average homeowner will see their polices jump in October.
Much of that is based on new digital Flood Insurance Rate Maps that put homes at risk that were once deemed safe, and therein lies much of the problem, Glynn County Commissioner Dale Provenzano said.
“They think the only people with flood problems are rich people living on the coast, so who cares?” Provenzano said of the members of Congress who voted for the higher rates.
They justified the bill by asserting that average Americans were paying rich people to build dangerously close to the coast. Congress failed to realize that a lot of low- to middle-income people live in rental property in areas that new FEMA maps designate as flood zones, and their landlords won’t be able to pay the higher rates without jacking up the rent, Provenzano said.
Those renters are going to be displaced, as are people who will see flood insurance rates higher than their mortgage payments, Provenzano and others complained.
The coast of Georgia, which hasn’t had a serious storm in more than 100 years, is getting lumped in with high-risk areas like the Gulf states, the coasts of South Florida and areas near Cape Hatteras, N.C., critics say.