Legislation scales back flood insurance premiums
Updated On: Mar 14 2014 08:31:46 PM EDT
It was startling news for homeowners when the news first came out of Washington D.C., an announcement that higher premiums for flood insurance were on the way for Florida homeowners.
But on Thursday, new legislation cleared Congress, reversing the government's overhaul of the flood insurance program.
Homeowners will undoubtedly come out on top because their flood insurance premiums were set to double or even triple, but the real estate market is really the big winner because sales are expected to stay on track.
Rick Goodman, who lives along the water in Riverside, said he's been paying a pretty penny for years to protect his home in case of a flood.
"We already pay a pretty hefty premium on top of our regular homeowners insurance," Goodman said.
He and others who live in flood-prone areas are happy to hear the overhaul, which President Barack Obama is set to sign.
"It could save you a couple thousand dollars a year," Goodman said.
Realtors say the bill could also prevent the housing market from taking another plunge.
"So we're trying to get legs underneath the housing market right now, so things like flood insurance, things like rising rates and mortgage underwriting being so difficult, these are all things that cause people to take pause when looking for a home," said Howard Flaschen of Round Table Realty.
He said higher flood insurance premiums could have been passed onto the buyers, creating serious sticker shock at closing.
"Uncertainty of what can happen is a problem," Flaschen said.
Insurance agents say it was the voice of the people that pushed politicians into action.
"There was a lot of pressure, especially people who were getting those increases," said Billy Wagner of Brightway Insurance. "It was a painful mess, a huge, drastic shock to them, so they voiced their opinions locally and nationally."
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