Flood Insurance Rate Hike Starts Tuesday For Some
BROAD CHANNEL — Flood insurance rates are set to increase by up to 25 percent starting Tuesday for some homeowners in coastal areas, many hit hard by Hurricane Sandy, the Federal Emergency Management Agency said.
The increase is part of the Flood Insurance Reform Act of 2012, better known as the Biggert-Waters Act, which was passed July 2012.
The bill was meant to stabilize the bankrupt National Flood Insurance Program and will remove subsidies for homeowners in flood zones around the country, many of which were added or changed after Hurricane Sandy.
The impending spike was the focus of a rally Saturday in Broad Channel, one of nine rallies around the country organized to draw attention — and urge reform — for the bill.
The Broad Channel rally was meant to educate residents as well as draw attention to the rate increase, organizer Dan Mundy Jr. said.
"A lot of people are just waking up to this," he said.
Tuesday's rate increase will go into effect for homeowners who've had subsidized premiums, any home that has incurred flood-related damage more than once, people who bought their homes after the act was passed and business owners.
The cost for flood insurance — which ranges from several hundred to several thousand dollars in the Rockaways and Staten Island — will increase 25 percent every year until premiums reflect full risk rates, according to FEMA.
The price increase is not for all homes; the increase for other homeowners will go into effect starting in 2014, for the rest of the homeowners in the changed flood maps. Those rates will increase 20 percent over five years until they reach the full risk rates, FEMA said.
It was not immediately clear how many homes would be affected by the increases. Some 70,000 homes and businesses were included in the newest FEMA maps, revised after Sandy, about double the original amount.
But those maps have not been approved by the city.
Homeowners at the rally Saturday said the flood insurance increase may force them out of their homes.
Another person asking for FEMA to stop the increase is Rep. Maxine Waters, the congresswoman from California who co-authored the Biggert-Waters Act with Judy Biggert, a former congresswoman from Illinois.
"When I agreed to coauthor this legislation, our goal was to create a bipartisan solution to repair our National Flood Insurance Program," she said in a statement last week, the day before the multi-state rallies.
"Neither Democrats nor Republicans envisioned it would reap the kind of harm and heartache that may result from this law going into effect."
Waters said she co-sponsored an amendment that would delay most rate changes for three years — which gives time for FEMA to make more accurate maps, she said.
Mundy, who's own home was damaged during last year's hurricane, said he hoped for an amendment to the current bill, a new bill or a delay in the rate increase.
"We hope moving forward here, since we're bringing so much attention, to it we will bring some legislative change," he said.