The important concept to remember here is that most NFIP insureds adversely select the coverage thus the slabbed from St Bernard Parish would be far less likely to buy the coverage if they moved to a high and dry area that has never experienced flooding despite the very cheap premium. Against that backdrop and given the looting of the NFIP by private insurers after Katrina I was tickled by Donelon’s appearance yesterday on WWL radio: (H/T the Ladder)
The 2009 hurricane season starts in three weeks, and state officials are expressing concern over an apparent dropoff in the number of homes covered by the federally-backed national flood insurance program.
State Insurance Commissioner Jim Donelan says the declining number of homes under the federal umbrella bothers him.
“We’re seeing a decrease, this year to last, of four percent in the amount of polices in effect in the state of Louisiana,” Donelan said.
Donelan says that as memories of the destruction caused by the 2005 storms fade, homeowners are getting more lax with their coverage.
He says that every property owner and renter in the New Orleans metropolitan area should participate in the national flood insurance program, even those in areas considered “flood proof.”
The populace here has been conditioned by Katrina and its aftermath. After all, the federal governemnt will pay for everything, from wind coverage that should have been covered by private insurance to the rebuilding tab for those who always thought flood insurance was a waste of money. And those that moved away from their pre-Katrina communities to much higher ground don’t see the reason to continue coverage so that wealthy Alabamians can continue the cycle of rebuilding beach houses on barrier islands only to be destroyed a few years later in the process becoming the NFIP poster child for all that is wrong with the program. Continue reading “La Insurance Commish Jim Donelon Brays on declining NFIP participation”