Published: Thu, August 31, 2017
Economy | By Melissa Porter

Flood Insurance Could've Helped Harvey Victims

Flood Insurance Could've Helped Harvey Victims

The massive toll Houston is facing from the aftermath of Hurricane Harvey is putting pressure on Congress to renew the federal flood insurance ahead of next month's deadline. Some may be forced to sell, if they can, and leave their communities.

"A lot of the people in the Houston and Texas area, they're not in flood zones", said Connecticut Department of Insurance Director of Consumer Affairs Gerard O'Sullivan.

Hunter estimates that total out-of-pocket costs for flooded homeowners could reach $28 billion, the largest in USA history.

On Friday, a new insurance law will take effect in Texas that could limit Harvey victims' rights.

Because much of the damage from Harvey is due to flooding, private insurance isn't going to cover as much of Harvey's costs as in a typical storm.

Katrina, the most destructive hurricane in US history in 2005 in Louisiana and elsewhere along the Gulf Coast, resulted in a record-setting $110.2 billion (£85.2 billion) in federal aid.

With Harvey, only two of 10 homeowners have coverage, Hunter estimated Tuesday. "So it's those people who want to look into having flood insurance to cover any possible damage that might occur". For that, you need separate coverage from the federally run National Flood Insurance Program. Homes in those areas have a one percent chance of flooding in any given year. If policyholders pay premiums that don't properly reflect their flooding risk, Lightbody said, that creates a "perverse incentive" that may encourage more people to live in areas at high risk of flooding.

Much of the Houston area falls outside those most vulnerable zones and many homeowners who aren't forced to have coverage have made a decision to do without. To be build up on piles, posts, or piers to protect them even more from flood damage.

Donna Clark, 24, left, walks with Federal Emergency Management Agency Contract Inspector Donna Clark, after surveying the damage to her apartment unit at the Saltgrass Landing Apartments in Rockport, Texas, Monday, August 28, 2017. While existing policies would remain in effect, the lack of available flood insurance could stall the sale of homes inside designated flood zones, where lenders typically require flood policies. That's roughly half of all properties - residential and commercial - in that area.

Eiland says policy holders should file a written notice with their insurance carriers and adjusters before Friday to be able to secure access to the higher interest rate. "Do not return to seriously damaged property unless you are informed that it is safe", Hancock said. "However, if the roof is gone or the windows are gone and you have water in the house, then it gets a little harder to figure out". If those are intact and you still have water in the house, most likely that's because of the result of rising water or storm surge. If the water rushes through the floorboard or walls, you're not covered. The National Weather Service has forecast that Houston and its suburbs could get as much as 50 inches of rain, the most ever recorded in the state.

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