Chaney files suit to stop flood insurance rate hike - WLOX.com - The News for South Mississippi

Chaney files suit to stop flood insurance rate hike

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GULFPORT, MS (WLOX) -

Mississippi's Insurance Commissioner filed a lawsuit Thursday to stop the dramatic increases coming for everyone who has flood insurance.

Insurance Commissioner Mike Chaney said the "draconian rate increases" are set to take effect Tuesday and could bankrupt many South Mississippi homeowners. He said some consumers will see rate increases higher than 3,000 percent.

The rate hikes for flood insurance are happening because of a bill passed in Congress called the Biggert-Waters Act, which was meant to shore up the troubled National Flood Insurance Program.

"In granting approval, FEMA used older Base Flood Elevation maps and then in 2009 began to change the Base Flood Elevation Maps and Zones.  This resulted in unanticipated rate increases," Chaney explained in a news release Thursday afternoon. "Many of the new Flood Elevation Maps are riddled with errors and consumers must pay for new elevation certificates to prove they are not in a flood zone."

Chaney said the National Flood Insurance Program has needed reform for a long time. 

"We know the program is deeply in debt, but it seems grossly unfair to place that burden directly on homeowners who simply followed the rules and did what was asked of them."

Chaney said several areas need to be studied by FEMA before the proposed rate hikes are implemented.

"Common sense needs to prevail," Chaney said. "The following  things should be considered - accurate elevation maps; a reasonable way for consumers to challenge maps; a reasonable phase in of actuarially sound rates after the studies are completed; voucher programs; enforcement of building codes for new construction; proper land use; the use of reinsurance; choices in deductibles and separate escrow accounts for premiums that Congress cannot raid."

View the official complaint here: http://www.mid.ms.gov/pdf/NFIP-Complaint.pdf

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