State officials say Katrina-style bailout of uninsured is unlikely
NEW ORLEANS, LA (WVUE) - State officials say if some 60,000 flood victims are looking for a Road Home-type of bailout, they are likely going to be let down.
An estimated 45,000 victims now face a rebuilding challenge without flood insurance, and that's going to have dire consequences. The state insurance commissioner says four out of five victims in 20 affected parishes do not have flood insurance.
"We have an awful lot of working poor in our state, and $60 a month is a lot of money out of their pocket," said Commissioner Jim Donelon.
In some cases, victims say they were advised against purchasing insurance from the National Flood Insurance Program.
"We were going to get flood insurance, but our agent talked us out of it," said flood victim Terrice Lee of Robert.
FOX 8 is now tracking three tropical systems in the Atlantic, and if they were to enter the Gulf, signups for wind damage would cease. And if you didn't purchase flood insurance a month ago, you may be out of luck.
"The NFIP side, they way they protect themselves they have a 30-day delay before the policy goes into effect," said Donelon.
FEMA is paying some benefits to those who suffered flood damage.
"The average assistance was only $7300," said Donelon.
But with a median house price of around $150,000 in Louisiana, that will leave many people well over $140,000 short on average.
"I will tell you how they will do it is with an SBA loan with low interest," said Donelon.
But even though that loan could carry two percent interest, it's going to hurt.
"The addition of the two mortgages is greater than the market value of the home," said Donelon.
In spite of that, insurance agents tell us that they are not seeing a rush of homeowners purchasing flood coverage. Some insurance agents say that some homeowners wonder, why bother with flood insurance? They say that after Katrina and Superstorm Sandy, the feds came through with billions of dollars in bailouts, providing some homeowners in places like Broadmoor, as much as $70,000 to to get homeowners back into their homes.
So far state officials say there's no talk of any bailout this time around for those without flood coverage.
"They weren't on the phone with us five minutes and said, 'No coverage, bye! It's your fault,'" said Lee.
"Make it happen. It's the most important insurance any homeowner can acquire," said Donelon.
The state insurance commissioner says Louisiana by far, has the most flood insurance claims of any state in the country, and pays out more than the next three states combined.
If you want to get flood insurance, contact your insurance agent or call FEMA at (800) 621-FEMA.
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