Here are some flood insurance facts.

In March 2014, the Homeowner Flood Insurance Affordability Act was passed to correct many of the problems caused by the Biggert-Waters Flood Insurance Reform Act of 2012. Recent articles about federal flood insurance have omitted important changes that provide some relief from the earlier law.

Among the improvements are a rollback of rate increases, including refunds for homeowners who were charged too much under Biggert-Waters. The extremely high rates often quoted do not apply to most insured homeowners in Muncy and other river towns. The average flood insurance policy costs less than $700 per year. This is slightly above the benchmark of 1% of the value protected.

Flood insurance is required only if there is a mortgage or credit line held by a federally-insured bank. For those whose federal insurance would be too expensive, private flood insurance may be more affordable.

Most federal flood insurance premium increases must be phased in gradually. And the same premium is passed along to the new owner when a residence is sold, rather than jumping immediately to a much higher amount. These are very important changes indeed.

The program is in transition to becoming financially self-sustaining, as it should be. The goal is to do this without creating excessively high flood insurance premiums that cause people to lose their homes.

After all, for more than 40 years most people paying flood insurance premiums have not been flooded so they have cost the program nothing.

The Affordability Act certainly did not solve all the problems with federal flood insurance, but the situation is not as bleak as some people seem to think. As more of the frequently-flooded properties are bought out to avoid repeated losses, as more homes are modified to reduce flood damage, and as prohibitions from building in flood plains are properly enforced, premium increases should stabilize.

More improvements are expected when the program is revised again in 2017. Let’s hope that our federal legislators continue to learn from the damage done by Biggert-Waters, and that common sense will prevail.

Sincerely,

Stephen Jaquith

Muncy, PA