On the need for flood insurance

Published Sep 15, 2017 at 4:00pm

The images and stories from the devastating flooding caused by Hurricane Harvey in Houston and Hurricane Irma in Florida are heart-wrenching.

When America’s coastlines are devastated by hurricanes, or inland areas are swamped by rain-swollen rivers, this country responds with compassion — and buckets and buckets of taxpayer-funded aid.

But, as when Hurricane Katrina devastated Mississippi’s Gulf Coast a dozen years ago and tens of billions of dollars of federal aid were poured into that state to help it recover, questions remain over how much responsibility property owners in disaster-prone areas have to protect themselves.

The Associated Press released an analysis that paints a troubling picture of how many homeowners along Florida’s 1,350 miles of coastline are taking their chances.

Florida has about 2.5 million homes in hazard zones, meaning they are susceptible to hurricanes and other natural disasters. Yet only 42 percent of these homes are covered by flood insurance, according to the AP. Even worse, that figure is down from what it was five years ago.

Apparently, a number of homeowners dropped their policies after the rates were hiked starting in 2012 for the government-operated flood insurance program, by far the most dominant provider of coverage. Those premium increases were approved by Congress to try to reduce the program’s $24 billion debt, which had been caused by a run of natural disasters and underpriced policies.

Where coverage has been allowed to lapse, in many cases it’s been done in spite of mortgage regulations that require the homeowner to have insurance.

Although there have been some horror stories about astronomical premium hikes after flood-risk maps were updated, on average the cost of flood insurance is reasonable given the risk. The AP reports it ranges in most cases in Florida between $300 and $500 a year.

This is not to pick on Florida. In Houston and other parts of southern Texas hit by Harvey, it’s estimated that less than a third of the damaged property that could have been protected by flood insurance had the coverage. Nationwide, only half of the 10 million properties that need flood insurance have it, according to officials with the National Flood Insurance Program.

So what do you do when disaster hits? Do you let those who neglected to protect themselves suffer the consequences of their poor decision and let lenders be swamped with water-logged repossessions?

Or do you bail the victims out, knowing that every time you do so, it makes it more likely that those who live along America’s oceans and rivers will continue to take their chances and pass on flood insurance?

It’s a dilemma, choosing between compassion and logical consequences.

No one wants to be heartless toward those whose home is washed away.

In designated flood zones, however, it is irresponsible of homeowners not to buy the coverage. Lenders and the federal government should work harder to make them do right before disaster hits.