Proposed flood insurance rate increase could halt rebuilding - WLOX.com - The News for South Mississippi

Proposed flood insurance rate increase could halt rebuilding

HANCOCK COUNTY, MS (WLOX) -

By Al Showers – bio | email

HANCOCK COUNTY, MS (WLOX) - Sweeping changes may soon come to the National Flood Insurance Program.

Last week, federal lawmakers passed a bill that would change the way the government-run program does business. One of the measures in the House bill would allow flood insurance premiums to be increased by as much as 20-percent. And that possibility has some Coast residents extremely concerned. 

"If the insurance is going to go up, I don't know what we'll do," Waveland resident Pam Gauthreaux said. "We're on a fixed income. We just can't afford it."

Pam lives with her husband, Bernard, in a home that has flooded three times since Hurricane Katrina. For them, a 20-percent increase would mean paying about a hundred dollars more a year.

"The wind insurance, we pay over $3,000 a year, so how can we budget an extra $100? I guess if we don't use our medicine or don't eat, we can go ahead and budget in an extra hundred bucks."

They say if the increase goes into effect, they'll be forced to move away. City leaders fear the Gauthreauxs won't be alone. 

"In an area where insurance is already a major concern, it's very costly to people trying to rebuild," Waveland Mayor Tommy Longo said. "Insurance is mandatory if you have a mortgage. We don't need it to cost any more. We actually need some relief in helping to get our premiums down. "

Bay St. Louis Insurance Agent David Treutel sits on an advisory committee for the National Flood Insurance Program. Speaking from our nation's capitol Monday morning, he said, " With the Flood Insurance Program facing a $19 billion deficit, the fact that Congress is addressing it  is a good thing."

He added, under the bill, the cap on policy limits for a homeowner would jump from $250,000 to $367,000.  For business owners, it would increase from $500,000 $600,000.

City leaders say any increase in premium costs will stifle redevelopment.

"It could be catastrophic, actually," said Bay St. Louis Mayor Les Fillingame. " While people are sitting here five years out from Katrina waiting for insurance cost to start tracking back downward, any kind of increase is going to be a real setback, as far as development is concerned."

A measure in the bill also adds a provision that would allow a homeowner to be eligible for their living expenses to be paid following a flood.

The changes to the program are far from becoming law. The Senate must draft its own version of the bill and pass it before Congress adjourns in December. Then the President would have to sign it.

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