The National Academies of Science has estimated that 50% of homes situated in a flood zone, that have a federally backed mortgage, and are required to purchase flood insurance – DO NOT.
Conservative estimate would be as follows; 2.5 million flood policies paying $1,000 a year would equate to an additional 2.5 billion dollars in yearly income to the NFIP program.
This additional revenue would help bring the NFIP program to solvency in a timely manner.
During Biggert – Waters 2012 the fine to the bank was $250 per incident of not carrying mandatory flood insurance.
After HFIAA – The fine to the bank was raised to $2,000 per incident of not carrying mandatory flood insurance.
2017 NFIP Reauthorization – We suggest raising the fine to $5,000 per incident and suggest stronger enforcement of the fines.
Read Reason #1 , Reason # 2 , Reason # 3 and Reason 4 here
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