In previous years the repeated lapses in the NFIP, and need for reauthorization to keep it going, opened up opportunities for congressional sponsors of the programs to collect plenty of campaign cash from lobbyists, such as the National Association of Realtors, the Houston Chronicle story noted.
“Flooding is the most costly and lethal type of natural disaster, causing about $6 billion a year in damage and killing roughly 140 people annually,” USA Today.com reported Aug. 26. Flood damage already has occurred in many states this year, including Louisiana, Texas, Florida, Mississippi, and New Jersey. The NFIP insures 5.6 million properties nationwide. The study by USA Today said the financial problems of NFIP reflect a broad government reluctance to restrain benefits. FEMA leaders and some lawmakers have tried to end the alluring premium discounts and the multiple insurance payments. “But there’s always been a few in Congress that have had enough political muscle to hold that back,” former FEMA assistant administrator David Maurstad was quoted as saying.
The General Accountability Office said in an April 21 report, “Unprecedented losses from the 2005 hurricane season and NFIP’s periodic need to borrow from the U.S. Treasury to pay flood insurance claims have raised concerns about the program’s long-tem financial solvency. Because of these concerns and NFIP’s operational issues, NFIP has been on GAO’s high-risk lists since March 2006. While Congress and FEMA intended that NFIP be funded with premiums collected from policyholders, rather than with tax dollars, the program is, by design, not actuarially sound. NFIP cannot do some of the things that private insurers do to manage their risks.”
The critical GAO analysis went on to say, for example, NFIP allows “grandfathered” rates. This lets some property owners continue to pay low out-of-date rates to get their damage fixed year after year. And NFIP can’t deny insurance on the basis of frequent losses. So, protection is provided for repetitive-loss properties, accounting for 25 to 30 percent of claims, GAO said. NFIP is “unlikely to pay off its $18.8 billion debt,” the GAO analysis continued. The agency also found “some contract monitoring records were missing, and no system was in place to allow” sharing of information on contractor deficiencies. Further, GAO said, “FEMA still lacks an effective system to manage flood insurance policy and claims data, despite investing roughly seven years and $40 million in a new system whose development has been halted.”
So, this slip-shod, wasteful government operation to deal with flood insurance now can be expected to become even more inefficient and more expensive, if Congresswoman Waters and others in Congress have their way. Hurricanes come and hurricanes go. But the spending of our tax money continues unceasingly, like a rushing mountain stream.
"The insurer, of course, was the federal government’s NFIP. "
Typical of the Dems. Never been a program that no matter how dismally ineffective and costly, they will continue to run it.
It has to be a pathology. It just has to.
34 repeated payouts for flood damage to the same property is insane–and maddening, when taxpayers are left with the bill. After 2 or three incidents, coverage should simply be denied, a house moved, or the property's "plot" removed from the town's list of buildable house lots.
However, there IS another side to the story. Insurance companies and banks make a LOT of money off flood insurance, and have ways of blackmailing homeowners into buying highly "gimmicked" and inflated versions of it.
Our mortgage holder has just increased the amount of insurance we are required (by them) to have, from 300k to 1/2 a million dollars. Conveniently {for them], they recommend buying the added insurance thru THEIR insurance company. (Gee, I wonder why.) Nothing about our house has changed. Yes, we do get a couple of inches of water in our basement when an unusually high tide comes along every 3 or 4 years. We deal with it. There is no claim, the sump pumps turn on, and we mop up the rest. We move our cars to higher ground if there's a bad one coming. In the blizzard/hurricane of 1978, we had a couple of feet of water in the basement, but we still have the same boilers. Our house is basically original from 1900, so it survived the 1938 hurricane, which moved islands around in Narrangansett bay, and rained salt water from the ocean in Burlington, Vt. Our house is protected by acres of salt marsh between us and the harbor. The harbor provides protection of the salt marsh. We are in the "no wave velocity" flood zone. We have have no expensive "belongings" to replace; our tv is 30 years old, there is no jewelry, silver, china, etc….just some old books. I could have our entire house replaced for about 280k, from the foundantion (poured concrete) on up. We have no need of half a million of insurance, but all of the sudden, it is a "necessity". Could it have to do with Bank of America's new search for revernue sources?
We are seriously considering saying "screw you" to the bank, and paying off the mortgage in full, [we only have three years left]. and then buying the appropriate amount of insurance on our own, NOT buying it "at gunpoint".
What Maxine Waters doesn't get, is that SOME of us try to be responsible ON OUR OWN, we do not look to "insurance" companies to ensure our welfare [Lord help us
if we did !]. If she wanted to make improvements to the flood insurance system, she could put in some incentives for responsible home ownership [flood zone or not], and some disincentives for repeatedly irresponsible homeowners. But that won't happen….
This woman is one of the reasons the country and California is so far in debt. Maxine, you are insane. It would be nice to educate the voters in her district to vote her OUT!!!
John, the problem is that the voters of CA are a bunch of leeches themselves and all the education in the world wouldn't change their votes. They demand the services that Waters provides since it forces someone else to pay for thier folly. Why else would she, Boxer, Brown, etc remain in office, and why else would CA be demanding that the other 49 states (or 56 according to Obamas count) bail them out?
Amen!! To many people with their hand out, or, should I say in our pocket
Waters is vastly too stupid to realize that setting up a program that gives away other people's money, with no upper limit, will rapidly expand out of control.
She has to be one of the most hyper-racist, jaw-droppingly stupid embarassments in the U.S. How does she even manage to dress herself in the morning? Perhaps she has a teenager drive her to her office, and unlock the office door for her, because she has never quite been able to figure those complicated things out.
She still does not know exactly what a microphone is used for – perhaps it is a pointer to show you where your head should be so people can see you? I seriously doubt she has the brains or education to be able to read and write.
The only reason she keeps getting re-elected, is that historically American blacks vote exclusively based on skin color, and on absolutely no other factor of any kind what-so-ever.
its all about the BS And she Is Total BS.