An April 2023 FEMA risk rating raised U.S. flood insurance rates, and some affected states are pushing back. To help you understand what is going on and what we expect to happen in the future, the highly-experienced iBestTravel team will keep you abreast of the latest developments and forecasts. Here’s the latest…
At least 10 states are challenging higher federal flood insurance rates. The states involved include:
- Florida
- Idaho
- Kentucky
- Louisiana
- Mississippi
- Montana
- North Dakota
- South Carolina
- Texas
- Virginia
Furthermore, many municipalities are suing the Biden administration over the Federal Emergency Management Agency’s Risk Rating 2.0 pricing plan, which went into effect in April. These rate increases will average more than 100% in coastal states such as Florida and Louisiana, where certain flood-prone municipalities may see average rates rise by over 500%. According to FEMA, the cost of flood insurance has risen for more than half of policies across the U.S.
The plaintiffs warn of significant distortions to local real estate markets and other effects, predicting that some individuals may no longer afford to stay in their homes.
Moreover, the average cost of flood insurance is expected to reach $1,808 per policy under Risk Rating 2.0, compared to $888 per policy prior to the program. However, federal law restricts the speed at which these increases can occur, with certain exceptions.
This analysis is part of a larger discussion on the implications of flood insurance policy changes, helping homeowners navigate potential impacts on their investments and financial future.
