Wednesday, March 23, 2016
FILE – In this Sept. 14, 2008 file photo, a beachfront home stands among the debris in Gilchrist, Texas on the coast of the Gulf of Mexico after Hurricane Ike hit the area. (AP Photo/Pool, Smiley N. File Pool)
It was a nice bit of government welfare, but don’t count on FEMA to come to the rescue if your house gets flooded. That’s what the National Flood Insurance Program is for.
Sadly, not enough homeowners are enrolled in the program.
“In an average year, the program breaks even,” said Bryan Koon, the head of Florida’s Emergency Management Division. In bad years, such as when a Superstorm Sandy or Hurricane Katrina happens, the NFIP has to pay out much more than it takes in, and, because premiums have been (intentionally) artificially low for so long, it has no cash reserve. It makes up the shortfall by borrowing from the U.S. Treasury.