Insurance issues are on the news

[Boats]

Just heard on the radio that many homeowners in the flooded areas will not be insured without flood insurance and that other related damages may not be covered as well.

Lawsuits are very prevalent right now. Many of the underwriters of the insurances company's themselves may go bankrupt which means the government will have to pick up the entire tab.

They also said that homes on the coastlines will be paying 3 to 4 times more than normal when premiums come due.

All US homeowner's insurance premiums will increase by at least 20 to 35% to cover their losses.

Note: There should be a law that if you live on the coast you must carry valid flood insurance. Otherwise you can not build in a flood prone area. Insurance companies near lakes and rivers make it available but the cost are high - this may explain why many do no have flood insurance.

Any input?

[SuperScout]

People living in hurricane-prone areas have been paying much higher insurance premiums for decades, at least here in Texas. Flood insurance is a whole 'nuther ballgame, as the definition of what constitutes a flood will vary by state and by carrier. I'm not trying to pick fly sh*t out of the pepper, just reporting the facts!

A larger question needs to be asked is why insurance companies insured homes that were demonstrably below sea level without a concomitant protective barrier. And who were the mortgage company geniuses who funded such dwellings? And how can the city building permit department escape a whipping as well? Why on earth did they even allow such building in that area?

There are multiple re-insurance agreements involving insurance companies, that help share major losses as will be reported. And there's a state-mandated fund, again at least in Texas, where insurance companies are required to pony-up x-percentage of premium revenue for such contingencies. These sources of funds, both corporate and state, will have to be exhausted long before the corporations or the state can go abegging to the Feds.

[David]

I figure they sell homes in those areas for just the same reason they now sell homes to illegal aliens, there is money to be made and damn the social consequences.

Boats the law you propose would never pass for the same reason stated above. Due to the huge tourist and/or gambling attraction of many of those areas and New Orleans in particular, most of the jobs are service orientated and leave people close to or below poverty level unable to afford health insurance let alone flood insurance.

Until the underlying socioeconomic issues of basic human need are tended too you can be sure the same tragedies will play themselves out in the same areas time and time again.

[Boats]

I think your both right. I live in the North and yet you can not build in a flood zone without flood insurance. But whose to say they take out the insurance one year and next year can't make the premiums?

This is a case for the law makers to address. So that everyone and I mean everyone understands the issues at hand and hard feelings don't make a round robin back to the entire city, state and federal coffers.

Hey I feel bad for these guys I really do. They took housing knowing the risk because of the lower cost in most cases. Their landlords may own the property but did not pay for flood insurance or even worse yet the insurance company refused to give them coverage because they knew it was high risk?

[David]

Socioeconomics are funny. I was just reading were the government gave the company that had the bus explode in flames a couple days ago killing 23 elderly people aboard $48,000 for shipping a few bus-loads of people out of New Orleans last month. On the news today they just announced displaced families will receive $2,300 to live on for the next three months.

In case the population of New Orleans be maligned as slackers living off of the government until the day of reckoning and then expecting another hand out (as has been hinted at in some previous posts on the subject) the unemployment rate in New Orleans was 5% in 2004 compared to a national average of 5.5% for the United States. These are hard working people that have been left to languish under a corrupt local government through generations of poverty.

[Boats]

That's about $75 per day for housing and food - lets not talk about any clothing they may need. How they come up with that number is amazing but I bet many were making less than that.

They should get free shelter from many of the charities down there and they will get food stamps and clothing for sure. They will survive - though you and I would find it tough for sure.

[David]

No doubt others will pitch in to help them. That still begs the question of why they need to though with $1.5 billion being floated around for recovery efforts.

The whole thing reminds me of the Red Cross selling kool-aid and sandwiches at disaster scenes while the smaller charities at tables right next to them hand out the same for free.

God bless our country and government, I hope the right thing is now done after generations of it not being done. So far though it is business (and I do mean business) as usual.