NYers Flood Insurance Premiums on the Rise
For Gay Alexander, Superstorm Sandy "is not over," she says, her voice cracking as she speaks about the cost for flood insurance on her damaged, waterfront Long Island home.
The single mother of two doesn't have the money to fix a hole in her house in Long Beach still left from the October 2012 calamity. Alexander's last flood insurance bill was $2,200, up from a pre-Sandy price of $1,200.
"And I can't move out because who will buy a house with insurance that keeps going up?" she says.
While President Barack Obama signed a law Friday that will delay the steep increases paid by Alexander and others, nearly 60,000 policyholders in New York are among the 1.1 million nationwide who will see their federally subsidized flood insurance premiums rise as part of changes to the National Flood Insurance Program, according to a review of federal data by The Associated Press.
The new law puts the brakes on a 2012 overhaul that aimed to shore up the cash-strapped program by requiring policyholders to immediately begin paying risk-based rates.
But about 35 percent of the properties with flood insurance in New York will still see their costs go up, including 12,083 in New York City. Homeowners will see rates rise by as much as 18 percent each year and owners of businesses and second homes will face an annual mandatory 25 percent increase until they switch to a risk-based rate.
Alexander said she's unclear exactly what her flood insurance will be in the future.
"I'm scared," says Alexander, a high school counselor who hasn't gotten a raise in a dozen years. "I have no idea what's going to hit me next."
In Long Beach, more than 3,000 policyholders face higher premiums unless they get an elevation certificate that reflects a risk-based rate. Outside of New York City and Hempstead, on Long Island, it's the town with the most affected policyholders in the state.
The city is working with state officials to see if the 86 businesses that are affected there can receive subsidies to offset premium hikes, said Mark Tannenbaum, executive vice president of the Chamber of Commerce.
"Am I concerned? Yes. Because we lost a number of businesses due to Sandy that didn't come back," Tannenbaum said, noting that the cost to elevate a business could be $100,000, and take six months or more - precious lost time for a seasonal business.
Officials are hoping high insurance rates will push homeowners and municipal officials to take the kinds of protective measures many people on the New York coast are now taking, to lift their homes out of harm's way.
Thomas Cunsolo is rebuilding his storm-ravaged home on Staten Island, where his flood insurance had jumped to $4,159 from $1,400 on a house that's uninhabitable. Hundreds of his Staten Island neighbors also got shocking insurance bills - one as high as $31,000 - on properties that had been obliterated and repaired just enough for owners to move back, he said.
The new law entitles Cunsolo and many of his neighbors to a rebate for some of the premiums they've paid.
"This brings immediate relief to homeowners - the first relief we are seeing since Sandy," Cunsolo said.
Once worth about $360,000, he estimates his 1,900-square-foot house would sell for only about $60,000 now.