Flood Insurance Homeowners Insurance Hurricane Coverage

2010 Shaping Up to Be a Year of Big Property Damage

M.P. McQueen did an interesting piece for the Wall Street Journal today entitled “As Hurricane Season Begins, Insurance Gets Harder to Find.” The lead lays the 2010 situation out bluntly:

From the Gulf oil spill and the floods in Arkansas and Oklahoma to the procession of hurricanes forecast for this year, the stage is set for major property damage in 2010.

And yet, fewer homeowners and specialty insurance polices are being sold, premiums are going up, and companies are reducing or dropping wind coverage as far north as Massachusetts. Some folks on the Atlantic seaboard are paying more than $3,000 a year for their homeowner’s policies.

As I talked about in my last post, polluted flooding from storm surges is a major concern from Louisiana all the way over to Cape Hatteras, North Carolina. Get out a map and look at that if you can’t envision what a massive stretch of coast that entails.

Then run up the east coast and consider how much damage can be caused there by hurricanes that get out of the Gulf and head north.

Not only are we looking at an environmental disaster and a potential deluge of property damage but the failure of the U.S. Congress to renew the National Flood Insurance Program is holding up 1,200 real estate closing a day according to the National Association of Mutual Insurance Companies.

So you see, it’s not just health insurance that is creating a bad reputation for the reformers on one hand and the insurance industry on the other. When people pay out thousands of dollars in premiums over the life of a policy and when they send politicians to represent them in the federal legislature, they’re expecting a bigger return on their investment in both cases.

If you’re in parts of the country most affected by potential storm, wind, and flooding damage, take a few minutes and read McQueen’s article. It’s a good breakdown of the situation and contains some good advice for alternate ways to protect your property in the event of disaster.

Flood Insurance

National Flood Insurance Program Languishes in Senate

While it’s probably pointless to say, “What is the Senate thinking?” you do have to wonder where their priorities are when yet again lawmakers have voted down legislation that included a provision to reauthorize the National Flood Insurance Program. The House took care of that before Memorial Day.

And what are they worried about? The federal deficit. So we’re going to solve that problem by making sure that the Gulf Coast, which hasn’t recovered from Katrina, is economically withering from both the recession and the oil spill, and is facing the worst forecast hurricane season in years doesn’t get any help when the waters rise? Oh, yeah. Now that’s some solid fiscal responsibility.

Jimi Grande, the senior vice president for the National Association of Mutual Insurance Companies hit the nail on the head. “It’s been over two weeks since the National Flood Insurance Program was allowed to expire, and the program is still being held up because of unrelated issues. This lack of action by Congress is unacceptable, particularly when we’re in the first few weeks of the 2010 hurricane season.”

The storm season in the Atlantic began on June 1 and the National Oceanic and Atmospheric Administration is predicting 14 to 23 named storms with eight to 14 turning into full-fledged hurricanes. Three to seven of those will go Category 3 or higher. That means winds of more than 110 mph.

Grande added, “We cannot afford to have political disagreements get in the way of protecting millions of Americans from flood losses.” Nor can we ignore that a great deal of the storm surge this time is going to be laced with oil that will make the clean-up and recovery more complicated than anything that area has seen before.

It’s probably more fun for Congress to whup up on the British Petroleum leadership to get sound bites, but isn’t it more the Congressional job to actually be leaders?

Flood Insurance Hurricane Coverage

Louisiana Gives Tax Free Weekend for Hurricane Supplies May 29-30

With the start of hurricane season just around the corner, the state of Louisiana wants to help its citizens be prepared.

On May 29th and 30th, residents of Louisiana can get a tax break when buying emergency supplies, including:

  • self-powered light sources like flashlights and candles
  • portable self-powered radios
  • two-way radios and weather-band radios
  • tarpaulins or other similar flexible waterproof sheeting
  • ground anchor systems / tie-down kits
  • fuel tanks (gas or diesel)
  • cell phone batteries and chargers
  • portable generators
  • carbon monoxide detectors

The tax holiday makes the 4% state sales tax exempt on the first $1,500 of the cost of such items, though local sales taxes still apply.

The Atlantic hurricane season begins on June 1.

Flood Insurance Homeowners Insurance

Early Estimate of Nashville Flood Damage: $1.5 Billion

An early estimate of the flood damages to Nashville, TN came in on Friday at $1.5 billion, but Mayor Karl Dean believes that number will climb.

According to Dean, the posted estimate includes only commercial and industrial properties and about 2,000 residences, but doesn’t include damages to public roads or bridges, or the contents in any of the buildings that were damaged. He said officials have identified 9.284 parcels with flood damage, roughly two thousand of which are residential properties.

So far, the assessment includes about 83 percent of the county. Some areas are still not accessible.

The city of Nashville has set up a website through which property owners can report damage, but it should be noted that damage reporting is the site’s sole purpose. It is not connected in any way with relief efforts or emergency services.

Said the mayor, “The assessment is continuing, and we ask property owners to report their damage so we can get an accurate figure.”

Flood Insurance Homeowners Insurance Hurricane Coverage

Jobless Benefits & Flood Insurance Extended…Again.

Yesterday, while most of us were madly scrambling to get our taxes filed by the midnight deadline, Congress voted to restore unemployment benefits for hundreds of thousands of Americans who had lost them when Republican opposition caused the bill to lapse before the Congressional recess at the end of March. The GOP contingent was opposing government spending.

After resuming operations, the House of Representatives voted 289-112 to extend both programs, and COBRA subsidies, through the end of May. The Senate had already approved the bill, and once the House had done so, it was sent to President Obama for his signature, which he provided.

Right now, with an unemployment rate of 9.7 percent, more than six million Americans are relying on jobless benefits, which average about $300/week. They had expired, along with COBRA subsidies and flood insurance, for more than 200,000 people, on April 5th. The flood insurance hiatus has delayed closings of 1,400 home sales every day, in flood-prone areas, as well as cutting emergency loans to small businesses, Congressional Democrats said to the press.

The flood insurance re-authorization has been made retroactive to February 28th, and extends the NFIP (National Flood Insurance Program) to May 31, 2010 – the day before the new hurricane season officially begins. It will have to be extended again, which will require a new vote – and weather watchers are concerned, as forecasters are currently predicting a summer with above-average storm activity.

The Independent Insurance Agents & Brokers of America (Big “I”) said it is concerned that Congress has only extended the program for a brief period again. Robert Rusbuldt, Big “I” president and CEO said, “It is alarming that the NFIP was allowed to expire, causing so much confusion and potentially leaving desperate homeowners and small businesses unprotected for more than two weeks. The Big ‘I’ is greatly concerned that these short expiration periods, coupled with the uncertainty of temporary extensions, will negatively impact the market.”

“This series of temporary extensions, last minute actions and service lapses during such a delicate period in our economy is of great concern to our agents, homeowners and small businesses,” added Charles Symington, Big “I” senior vice president of government affairs. “Though we are grateful that Congress extended this program, we are increasingly frustrated by these repeated one-month extensions and the periods of expiration that sometimes result from them.”

Also expressing frustration with Congress were individual Insurers. One of them, David A. Sampson, president and CEO of the Property Casualty Insurers Association of America (PCI) said, “We are pleased that Congress made this a priority upon returning from recess this week. But these short putts down a long fairway set a dangerous precedent that leaves homeowners vulnerable. We need a long-term, sustainable solution to the flood program. Over 5.5 million Americans rely on this vital program.”

Flood Insurance Homeowners Insurance

London Science Museum Takes Neutral Position on Global Warming

Homeowners in New England are looking at filing flood insurance claims, while residents of the Midwest have had one of the worst winters in years, and even Texas got more than a foot of the frosty white stuff this year. In the midst of all this, the London Science Museum, with sponsorship from Royal Dutch Shell has opened a new climate gallery which is adopting a more neutral position on global warming.

Set to open in November, the $6 million exhibit will provide “up-to-date, accurate” information on the science of global climate change, and is intended to “satisfy the interests and needs of those who accept that human-induced climate change is real, those who are unsure, and those who do not,” said a museum representative in a statement to the press.

According to report by Reuters, the museum’s director, Professor Chris Rapley told the press, “The scientific community has, with some exceptions, concluded that climate change is real, largely driven by humans and requires a response. Our objective is to minimize the shrill tone and emotion that bedevils discussion of this subject.”

The previous exhibit was called “Prove It! All the evidence you need to believe in climate change,” which closed last month. That exhibit featured a poll which shoed that many of its visitors did not believe the scientific evidence behind human-caused climate change. Late last year, after email messages from a British university were released by hackers and latched onto by skeptics who felt they showed that global warming was largely exaggerated, the scientific data was called into question. When an erroneous statement about the Himalayan glaciers melting by 2035 was released in January, shortcomings of the U.N.’s panel of climate scientists were made public. The result was a call for reform from the panel, and the creation of the new Climate Science Gallery.

Other sponsors of the new gallery are Germany’s Siemens, the Garfield Weston Foundation and Britain’s Department for Environment, Food and Rural Affairs.

Other news this week from the London Science Museum is its restated commitment to reducing its carbon footprint.

Flood Insurance Homeowners Insurance

Congress Adjourns Without Extending Flood Insurance

Yesterday, we blogged that if Congress didn’t vote on it today, the federal flood insurance program would lapse (again) as would some unemployment benefits. The Insurance Journal is reporting that Congress could not come to agreement on the bill, and adjourned without passing it.

Congress will be in recess until April 12th.

As a result of the bill not passing, the National Flood Insurance Progam will lapse on Sunday, March 28th at midnight, and from that point until Congress returns to vote in mid-April, insurance agents will be unable to sell new or renewal flood insurance policies, which are required by lenders to close loans on properties lying in certain flood hazard zones.

The Senate’s vote on the bill was blocked by Senator Tom Coburn (R – OK) who argued that voting to extend jobless benefits (part of the same bill) would add to the deficit. Senate Democrats countered with the assertion that this was emergency spending.

This marks the second lapse of the NFIP this year, but last month’s lapse was only a few days; this one will be roughly two weeks, and that’s assuming there is a vote on the day Congress reassembles. If that happens, Congress can reinstate the program retroactively.

It is important to remember that while new policies and renewals cannot be processed, currently insured homeowners remain covered, and claims payments will not be affected.

Flood Insurance Homeowners Insurance

Flood Insurance Could Lapse…Again

According to a post in today’s Insurance Journal, real estate agents and insurance agents are once again being advised to warn clients about a possible interruption of the federal flood insurance program in three days – an interruption that could last longer than last month’s lapse. The Senate is expected to vote tonight or tomorrow to extend the program, but if the vote doesn’t happen, the program could be down for weeks while Congress is in recess.

Currently, the NFIP (National Flood Insurance Program) is schedule to expire at midnight on March 28. While the House of Representatives has agreed to extend the program through the end of April, the Senate has been trying to get it extended through the end of 2010. However, if the Senate, which has been largely preoccupied with healthcare reform, does not adopt the House measure before Sunday night, the program will expire.

Just last month, the program went down to the wire in a similar fashion, when a bill extending COBRA and unemployment benefits as well was delayed on the floor by Senator Jim Bunning (R-KY) who had concerns about funding for job insurance. Without a vote, the NFIP expired on February 28th for a few days, until the extension through March 28th was finally passed and signed into law by President Obama on March 2nd.

There is a valid fear that politics could once again delay a vote to extend the program. Matt Brady, spokespan for the National Association of Mutual Insurance Companies told the press, “As we’ve seen, these short term extensions create situations where the NFIP is allowed to lapse because of unrelated political or legislative issues. Hopefully, the program will be extended again and lawmakers will use that time to pass legislation reforming the program and extending it for a longer term.” He continued, “We still believe the extension will pass, but given recent history I think it’s always a good idea for agents and brokers to be prepared for a hiatus.”

John Prible, vice president of the Big “I” (Independent Insurance Agents and Brokers) also shared concerns with the press, bringing up the fact that once again the NFIP extension is tied to a bill on unemployment benefits and COBRA. He said that the Senate staffers he’s spoken with are “optimistic” that a vote will happen by the end of Friday. Prible is more concerned over the fact that if a vote does not happen before the program expires, the Congressional recess could keep NFIP on hold for two weeks. Of that concept, he said, “That’s scary.”

The possible hiatus could not happen at a worse time of year. FEMA (the Federal Emergency Management Administraztion) which administers the national flood insurance program is trying to get more homeowners to purchase flood insurance, and last week was actually National Flood Insurance Awareness Week. FEMA cites information provided by the National Weather Service, which says that over a third of the United States is in danger of flooding at this time of year.

Insurance agent and company lobbyists have been pressing for a multi-year renewal of NFIP, along with broader reforms to the program, for the better part of a decade.

Flood Insurance Homeowners Insurance

An Alternative to the National Flood Insurance Program?

Most of us have heard of NFIP – the National Flood Insurance Program – even if we don’t own homes that are situated in flood zones. Now, a company called CatCoverage is offering an online alternative to national flood insurance.

Known as NCIP – the Natural Catastrophe Insurance Program – this new product is available to agents and brokers as well as direct to consumers.

It’s a web-based program that offers, “primary layer insurance for the perils of landslides, floods, and earthquakes.” The policies are being underwritten by Lloyds, which has a reputation of being one of the best in the business. It is administered by Salt Lake City, UT – based Poulton Associates, Inc., which also created the program. Poulton’s director of wholesale marketing, Marissa Halverson, says that many consumers and insurance professionals still think the NFIP is the only source of flood insurance. allows both business and residential property owners to purchase flood, earthquake, and landslide coverage under one insurance policy. In addition, customers can choose coverage options that NFIP doesn’t offer, such as additional living expenses for homeowners, loss of income coverage for businessess, and other expenses.

Estimates show that roughly 83% of Americans do not have any kind of flood or catastrophe insurance, and about a third of them erroneously believe that standard homeowners insurance covers flooding and other such damage. (It does not.)

So far, the web-based CatCoverage is available in 27 states.