Tuesday, December 20, 2005

Flood or Wind-Driven Surge?

Get ready for Congress to open it's pocketbook and your tax dollars to bail out folks in MI and LA who didn't have flood insurance when Katrina hit. Seems kinda silly to have a national program that provides flood insurance for homeowners who live within a floodplain, but then after a flood, provide a $150,000 check to every homeowner who didn't have flood insurance.

Further defying logic is the insurance industry, which is really the root of this problem. Insurance companies will have you believe that the water creeping on your doorstep needs to be qualified in order for you to collect on your policy. That's right...so if Katrina Part 2 comes a knocking with some packed hurricane-force winds, generally, that's considered "wind-driven surge" and you probably won't see a penny from your homeowner's insurance.

This happened to a friend of mine on the Eastern Shore when Isabel touched down in 2003 and took out their house, boat, and practically all their belongings. Because the water was considered "wind-driven surge," they saw nothing from the homeowner's flood insurance. There you have it - even the prepared get screwed, and guess who gets left with the check...

Instead of approving tax payer dollars to fund folks who weren't prepared, Congress needs to pass some legislation that forces the insurance industry to redefine how they cover floods and protect folks who expect to be covered when the tide is high.


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