Quote:
Originally Posted by bluefish81
You want to know something really stupid, IMO? At the time that Katrina happened, despite being below sea level, New Orleans wasn't in a flood zone that required flood insurance. Why? Because it's behind a levee.
Honestly, property insurance companies don't really care about flood plains to insure a homeowner. Why? Flood insurance rates and claims are ALL set and paid by the federal government. The only difference is the name on the policy and potentially how fast or slow that claim is paid - i.e if you write it through an insurance company vs the federal government you'll probably get a check a lot faster. Your homeowners policy isn't going to provide flood coverage - if you read it, it is most likely specifically excluded. Insurance companies are more concerned about the wind exposure down there.
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I apologize for any inaccuracies, but I'm talking about areas where, for any practical purposes that the cost of insurance makes rebuilding impossible for most people. It may be that the insurance companies fear wind driven water rather than just rising water, but the picture has apparently changed since Katrina and the damage is largely thought to have been related to the storm surge, rather than wind.
And I'm really not being critical of the companies. I wouldn't want to insure properties that I knew I was especially likely to take a loss on. Nobody who needs a mortgage really has to live in a single family residence on the beach or the bay, I suppose.