State demands transparency from FEMA on insurance rate calculations

BATON ROUGE, La. (WAFB) - Leaders are hoping to get change and transparency when it comes to flood insurance in Louisiana.

Sen. Bill Cassidy introduced a bill on Tuesday, July 11, to reform the National Flood Insurance Program (NFIP). Sen. Cassidy said no matter where he goes when he back home to Louisiana, he hears about the trouble folks are having with the program.

“It will address our out-of-control rate increases for homeowners in our state. Our plan caps premium hikes, it provides means-tested discounts for those who have excessive hikes, restricts the oversight of the insurance companies, and we simplified the claims process for homeowners who are just bogged down with red tape,” said Sen. Cassidy.

Here at home, Louisiana lawmakers have signed a resolution, urging the attorney general along with 30 parish presidents to take FEMA to court and demand answers on how they calculate what you pay.

“Rates have gone up anywhere from 300-400%. Here in Terrebonne Parish, anywhere from 200-300% on flood insurance. The challenge is we have people that can’t afford to pay flood insurance. If you have a federally backed loan, you have to have flood insurance, and so some people are actually turning in their keys because they can’t afford it,” said Rep. Jerome Zeringue.

Sen. Cassidy says 20-25% of folks currently enrolled in the NFIP may end up dropping their insurance because of the rate hikes, which he calls a death spiral.

“Instead of having your risk spread out over large numbers, it gets concentrated on fewer people and then the rates go higher, and then more people drop off, and then it continues to spiral,” added Sen. Cassidy.

State lawmakers have already allocated the funds for the attorney general to take FEMA to court. Now the legal process just needs to play out.

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