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From the article it sounds like right now the system isn't very balanced. People with lower value homes and/or lower flood risk paying the same as those with higher value homes and/or higher flood risk.
"Right now, the owner of a $1 million Florida home and the owner of a $200,000 Montana home are paying the same rates for insurance"
I think it's good they're updating it to better account for home values (or replacement cost) and risk levels. Personally I'm not keen on buying a place that'd require flood insurance. But if I did I don't want to be paying the same as someone with a much more expensive house in a higher risk area.
From the article it sounds like right now the system isn't very balanced. People with lower value homes and/or lower flood risk paying the same as those with higher value homes and/or higher flood risk.
"Right now, the owner of a $1 million Florida home and the owner of a $200,000 Montana home are paying the same rates for insurance"
I think it's good they're updating it to better account for home values (or replacement cost) and risk levels. Personally I'm not keen on buying a place that'd require flood insurance. But if I did I don't want to be paying the same as someone with a much more expensive house in a higher risk area.
Value should not matter, it is replacement cost that counts. That home in MT can easily cost more to replace than the home in FL.
Accuracy would be nice also, considering them revamping this is telling me they were not accurate over the last 50 years. And some realistic probabilities as well; I live in a "once in a hundred years" area, yet there is no documented flood in my area with records going back to the late 1800's. There has never even been standing water here despite the hurricanes and even record rain fall from Irma.
Lastly, the local gov prides itself on taxing the value of my property, a value in which is determined by its location. What needs to happen is a formula assigned to how much value the location adds to value, the flood risk, and either I or the local gov should have to divert that money to the flood insurance program.
Value should not matter, it is replacement cost that counts. That home in MT can easily cost more to replace than the home in FL.
As twingles said, risk matters, too. If the home in Florida is ten times more likely to have a flood claim shouldn't their premium be higher even if replacement cost is the same?
As twingles said, risk matters, too. If the home in Florida is ten times more likely to have a flood claim shouldn't their premium be higher even if replacement cost is the same?
Yes, assuming that "risk" is also weighing past history of actual floods. As noted,some homes in "high risk" areas have never had floods, which suggests the risk may not be as extreme as elevation would imply.
(That said, I weighed the flood risk, and opted for a house 42' above sea level just to be safe, so....lol)
Flood areas can change over time. Construction in the surrounding areas or upstream can make an area that was not prone to flood right smack in the flood zone.
Happened in my area when a condominium complex was constructed nearby. All of the new construction (concrete, foundations, parking areas, streets, etc.) and the removal of the grass and trees caused a number of homes nearby to be in a new flood zone.
Don't buy near a flood zone.
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