INDIANAPOLIS (AP) - Thousands of Indiana homeowners who live in flood-prone neighborhoods are bracing for insurance premium increases, despite Congress‘ latest fix for the government’s debt-saddled flood insurance program.
More than 13,300 Indiana homeowners can expect annual increases of up to 18 percent in their flood insurance premiums in the years ahead, according to an Associated Press analysis of government data.
Another 3,200 owners of second homes and businesses will see annual increases of 25 percent.
A bipartisan measure signed Friday by President Barack Obama offers relief to many people whose premiums soared thousands of dollars overnight under a 2012 overhaul of the taxpayer-subsidized National Flood Insurance Program.
But that relief isn’t permanent for all. Rates are still set to rise as officials try to rid the program of $24 billion in debt.
Their two-story home has a scenic view of the White River, lined with towering sycamore and oaks trees, and they have a small dock with two boats. But it comes with the burden of frequent flooding that periodically sends water sloshing up to their foundation - a situation to which they’ve become accustomed.
Buckley said their home’s annual premium had been about $3,100 but will increase to more than $3,500 this year and threaten their standard of living as it climbs higher in coming years.
“If I’d known the flood insurance was going to do this, I never would have bought this place,” Buckley said as she surveyed her backyard. “I’m 57 years old. I’ve been working for 40 years - all my life. I can’t get a better job. I can’t afford any more.”
The owners of about 16,600 Indiana homes and businesses currently pay subsidized rates that will be steadily whittled down. Collectively, people getting those discounts and many more already paying risk-based rates pay about $25.3 million per year in premiums. Those premium increases are going to create “a real mess” for both home sellers and buyers in some flood-prone areas, said Dean Doughty, sales manager for Century 21 Breeden Realtors in Columbus.
The south-central Indiana community was hit hard by flash flooding in 2008, soaking hundreds of homes, and also causing $171 million in damage to Columbus Regional Hospital and more than $100 million in damage to a Cummins Inc. research center.
Doughty said his office has been getting calls from some home sellers who are worried about the rising premiums and asking if their property will be affected.
“It’s obviously going to hurt the sellers in some of these flood zone areas because now all of sudden their property values are going to go a lot lower,” he said. “It will absolutely impact the industry.”
Residents of the northwestern Indiana town of Munster have collected more claims of any Indiana community over the program’s life - more than $24 million, according to the AP’s analysis. That likely reflects the impact of September 2008 flooding after torrential rains damaged more than 17,000 homes and businesses along the Little Calumet River.