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Thread: Flood insurance

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    Default Flood insurance

    Quote Originally Posted by mountainannie View Post

    Here in the USA we have a Very Stupid Program of Federally mandated and subsidized flood insurance which keeps paying folks to the coast to REBUILD their homes in the exact same places. If it were private insurance -- only the super rich could afford it and it would be one of their 5 houses and we would not be facing the possibility of loss of life.
    That is indeed ridiculous. Governments should not be in such a business.

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    Quote Originally Posted by windeguy View Post
    That is indeed ridiculous. Governments should not be in such a business.
    As someone who owned a home on a barrier island for 36 years, and who had almost $250,000 damage from Sandy, I can tell you that our flood insurance paid us a grand total of $27,000. Their policy is to deny, deny, deny. And then the rates skyrocketed. People WITHOUT insurance were given disaster monies, and in many cases got much more than we did. We did not qualify because we had the insurance.

    Now, contrast that with all the Caribbean and southern Atlantic islands, most of the residents get nothing.

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    The reality will set in eventually. People shouldn't be building primary residences on flood plains and within storm surge locales. As flooding events increase in frequency and severity going forward, there will come a point in time, when govts will have no choice but to cut back the amount of homeowner support they dole out in these situations and the cost of add-on flood insurance will skyrocket. Many insurers won't cover a property for flooding if it is located in a vulnerable area. Thus it is only govt's political generosity that permits this situation to continue. John Doe citizen would never cough up the coin to own a house that could and likely will be be wiped off its foundation at some point without govt assurances that remuneration will be provided.

    Unfortunately, the state of Florida may need to move lock stock and barrel to Wisconsin but you can't tame nature to the extent needed to protect property so continuing to do so is a fool's errand and a waste of taxpayer money. Wish to position a house where you can cast from the porch, pay for the risks of doing so yourself I say.

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    Quote Originally Posted by Cdn_Gringo View Post
    The reality will set in eventually. People shouldn't be building primary residences on flood plains and within storm surge locales. As flooding events increase in frequency and severity going forward, there will come a point in time, when govts will have no choice but to cut back the amount of homeowner support they dole out in these situations and the cost of add-on flood insurance will skyrocket. Many insurers won't cover a property for flooding if it is located in a vulnerable area. Thus it is only govt's political generosity that permits this situation to continue. John Doe citizen would never cough up the coin to own a house that could and likely will be be wiped off its foundation at some point without govt assurances that remuneration will be provided.

    Unfortunately, the state of Florida may need to move lock stock and barrel to Wisconsin but you can't tame nature to the extent needed to protect property so continuing to do so is a fool's errand and a waste of taxpayer money. Wish to position a house where you can cast from the porch, pay for the risks of doing so yourself I say.
    Have you tried obtaining house insurance in the DR. We tried when we bought the house we are in now, but because it has glass in the windows ( which it appears is strange in this country) the house had to be surveyed before the insurance could be granted. The surveyor called to arrange the appointment and his first question was, "Do you have a dog?" The answer was "yes, we have 4, " and he announced they do not survey houses where there are dogs. Hence, we have no house insurance.

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    Quote Originally Posted by Matilda View Post
    Have you tried obtaining house insurance in the DR. We tried when we bought the house we are in now, but because it has glass in the windows ( which it appears is strange in this country) the house had to be surveyed before the insurance could be granted. The surveyor called to arrange the appointment and his first question was, "Do you have a dog?" The answer was "yes, we have 4, " and he announced they do not survey houses where there are dogs. Hence, we have no house insurance.

    Matilda
    That qualifies for "Only in the DR"!

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    Insurances companies are my least favorite corporate entities. Their business model is to take your money and then bend over backwards to find a reason not to pay a claim. A good sized disaster can wipe out an insurance company or a bunch of them in the blink of an eye.

    Here in the DR there just isn't the pool of customers to fund the type of potential losses from strong storms, negligence, malfeasance and whatever else. So here in the DR the companies are very selective in who they cover, what they cover and usually cap their liability at a price point much lower than the replacement cost of that which is being insured.

    Similarly back home, most insurance companies will not cover flooding (except sewer backup) for the very same reasons. Way too much financial exposure on a per event basis that cannot be covered by premiums that people will pay. Here, when storm X blows through Seahorse Ranch, those with hurricane coverage may get something, but won't be rebuilding unless they have additional funds of their own available to do so.

    In the US that does have a govt funded flood program, those who can afford the premiums and live in a high risk area, get that coverage and the taxpayer pays to rebuild their home whenever and as often as needed. Canada doesn't have such a program but the federal govt usually coughs up some cash to help people rebuild. I believe "we" are beginning to rethink that approach and new planning and zoning rules are beginning to reflect this in a limited way. A few more bad years and some politician may be forced to admit that the public expectation and govt desire to buy votes just isn't going to continue as is forever.

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    Quote Originally Posted by Cdn_Gringo View Post
    In the US that does have a govt funded flood program, those who can afford the premiums and live in a high risk area, get that coverage and the taxpayer pays to rebuild their home whenever and as often as needed. Canada doesn't have such a program but the federal govt usually coughs up some cash to help people rebuild. I believe "we" are beginning to rethink that approach and new planning and zoning rules are beginning to reflect this in a limited way. A few more bad years and some politician may be forced to admit that the public expectation and govt desire to buy votes just isn't going to continue as is forever.
    Just a clarification...... In the US, if you live in a flood zone, and you have a mortgage, buying flood insurance isn't optional, your mortgage holder will demand it. As part of the survey that's done before buying, the flood level is reported, and your premium is based on that. Oceans, bays, rivers, etc. affect it.

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    Gracias AE
    We Canadians need education in American ways.....obviously ^^^^^^^

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    Quote Originally Posted by Cdn_Gringo View Post
    .....A good sized disaster can wipe out an insurance company or a bunch of them in the blink of an eye.

    Here in the DR there just isn't the pool of customers to fund the type of potential losses from strong storms, negligence, malfeasance and whatever else. So here in the DR the companies are very selective in who they cover, what they cover and usually cap their liability at a price point much lower than the replacement cost of that which is being insured.
    Interesting theory, but in today's insurance industry it's just not so. Insurance companies in the DR operate in the same way as insurance companies do worldwide. No one company carries 100% of the risk by itself. All have extensive reinsurance agreements with larger reinsurance companies customarily outside the DR, who themselve spread their risk by sharing with other entities and so on ad-infinitum. That's how the insurance market works, that's how insurers can make money from "unprofitable" risks, therefore it is unusually rare for an insurance company to fold under the weight of claims. Insurance markets, most notably Lloyd's of London have faced huge losses from natural disasters and space exploration and have managed to keep their heads above the water (no pun intended). Insurance companies generally do not have large surpluses of income from premiums over the amounts paid out in claims. The bulk of their profits come from using premium income as stake money for investments and financial acquisitions.

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    Quote Originally Posted by AlterEgo View Post
    As someone who owned a home on a barrier island for 36 years, and who had almost $250,000 damage from Sandy, I can tell you that our flood insurance paid us a grand total of $27,000. Their policy is to deny, deny, deny. And then the rates skyrocketed. People WITHOUT insurance were given disaster monies, and in many cases got much more than we did. We did not qualify because we had the insurance.

    Now, contrast that with all the Caribbean and southern Atlantic islands, most of the residents get nothing.
    AE- I assume that you had flood insurance through the National Flood Insurance program? https://en.wikipedia.org/wiki/Nation...urance_Program

    Would it have been possible for you to also buy a supplemental policy on the private market or is that somehow forbidden?

    I find it very odd that it was the Dems that tried to cut back on the Federal subsidy program while the GOP voted to roll back restrictions....

    I know that MOST home owner insurance agencies make a big effort to down size their pay outs...

    Also ?? could you have gotten any $$ if you had decided NOT to rebuild your house on site? My understanding is that that FEMA program only pays homeowners to repair existing structures... Seems that there ought to be some sort of program to rather just buy out the owners in some of those flood zones --

    Of course - very few folks will walk away from coastal properties in the USA yet --
    But - on the other hand - with more and more severe hurricanes and floods predicted - I am not so sure that all taxpayers ought to be on the hook for rebuilding in the federal designated flood zones....

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