Apostal Group

Help Keep Flood Insurance Affordable Niko Apostal 08/29/17

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Every now and then, something comes across my desk on the national level that can affect the buying and selling of homes. Today was such a day. That’s why I’d like to discuss flood insurance.

What is Flood Insurance?

Flood insurance is provided by insurance companies to pay for damages to homes that have been affected by flooding, typically caused by natural disasters.  For homes in flood zones, you have to have flood insurance in order to have a mortgage.

That’s why Congress is trying to pass the 21st Century Flood Reform Act (HR 2874).

What is HR 2874

The 21st Century Flood Reform Act proposes to do the following:

  • Reauthorizes the current flood insurance that exists for the next five years
  • Caps rates at $10,000/year for premiums
  • Directs FEMA to create a rate table so that fewer people will be overcharged and more properties can be covered
  • Sets aside $1 Billion for flood mitigation assistance grants
  • Increases access to the private market for flood insurance

Why Is This Important?

Although Chicago is not in a flood zone, we are part of the national market. Therefore, things that affect the national market will affect us.

Since insurance companies would prefer not to offer flood insurance, without this bill passing, many homes will be uninsurable. When a home can’t be insured, then mortgage lenders do not want to lend money on the home.

This results in:

  • Homeowners being stuck with property that can no longer be insured
  • Inflated insurance rates
  • Higher mortgage rates

It will also make it difficult for families to bounce back after storms like Hurricane Harvey that is devastating the Houston area.

That’s why I’m asking you to call your Congressman and let them know that you want them to support HR 2874. If you’d like more information about this bill, blood insurance, or buying and selling in the Chicago area, please give me a call.