Agents can do little to prevent huge rise in flood insurance
Parish sets town hall meeting on issue
Kyle Barnett - Apr 04, 2013
After many West Bank residents received the shocking news that their flood insurance rates could skyrocket next year, a FEMA spokesperson warned that the quoted prices were just estimates and that a final price would depend on the homeowner’s insurance company.
But that doesn’t seem to be the case, according to Trey Granier, an insurance agent with Farm Bureau. Granier says that the computer program that configures rates for federally-backed flood insurance is developed by the National Flood Insurance Program (NFIP) and insurance agents can do very little to influence those rates. In fact, specialists from NFIP were the ones who handed out estimates at a FEMA-sponsored open house, which seems to indicate that the estimates residents received were spot on.
Granier added that the insurance industry has been left in the dark regarding new FEMA flood maps that could drastically change the West Bank.
Jackie Chandler, a public affairs specialist with FEMA, said NFIP specialists met with parish residents at an open house held at R.K. Smith Middle School last Monday to give them an idea of how the new maps will affect them.
"They used a rate manual that insurance agents will refer to when they are quoting specific homeowners concerning what is your zone and what is your elevation," Chandler said. "The specialists at the open house are given examples about what the increases could be, but not the rates."
She said in no way were the estimates given at the open house final, including those that put the potential payments for some West Bank homeowners in the tens of thousands of dollars. However, Granier said the insurance industry relies on the NFIP to set prices.
"We have a computer program. You put in the address and the flood zone," he said. "No matter if you come to Farm Bureau, All-State or ‘Mom & Pop’s Insurance’ all the guidelines and all the zoning is supposed to be to NFIP standards."
Granier believes that if the new flood maps are implemented, property values on the West Bank will be decimated.
"Basically we are talking about the inevitable about what is going to happen on the West Bank," Granier said. "The levee is not going to be built in time."
Granier says his office has been inundated with calls but that there is little he can do right now to help his customers.
"We’re reacting to what’s going on," Granier said. "We’ve had a lot of residents calling and asking what it means. At this time we don’t know."
Tiffany Brown, an insurance agent with Dave Millet Insurance in Boutte, says that all flood insurance rates are set by the federal government.
"I just cannot see them making everyone pay $10,000 a year for flood insurance," she said. "I’m sure something will come down where we can afford this, otherwise these houses will have to be raised."
Brown said the only way she can offer people a better flood insurance rate is if they raise their homes.
"If people raise their houses, we can give them a better rate but they have to do their homework," she said. "They need to work with their insurer because their insurance company could help them pay for it."
When several Lafitte residents were forced to pay high flood insurance cost years ago, Brown said there was nothing her agency could do to help.
"We quoted a ground level home worth $100,000 at $10,000 in insurance," she said. "That wasn’t something we were able to change because the government sets the rates."
Insurance soars for
many on West Bank
While many homeowners living on the East Bank of St. Charles are protected by a new levee and expect to see a decrease in their flood insurance, their West Bank neighbors have been left virtually unprotected as the West Bank hurricane protection project has dragged out over the past few decades. For many on the West Bank, their flood insurance rates are now set to increase dramatically.
FEMA also decided not to recognize the century old Sunset Drainage District levee protecting all of Des Allemands, Paradis and Bayou Gauche. Residents in those areas are expected to see a significant increase in their flood insurance rates many times over what they currently pay.
Juanita Guidry bought a home in Bayou Gauche in 1999 and said although she was not required to buy flood insurance because the Sunset Drainage District levee was recognized at that time, her family went ahead and did so. She was paying $350 a year, but under the new flood map Guidry’s insurance is estimated to rise to $15,000 a year.
Bayou Gauche resident Cathy Porthouse burst into tears after being notified that her insurance could be as much as $18,000 per year.
Majority of East Bank will
see lower insurance rates
On the East Bank, Keith Adams, president of St. Rose’s Preston Hollow Homeowners Association, said he is happy to hear the rates will be going down for his neighborhood.
"All I can say is it is positive for us, not necessarily for everyone else. Some people are very upset, I know that much," Adams said. "Our neighborhood isn’t exactly one of the richest in the parish so any break we could get would be appreciated and quite welcome."
Deanna Polutti has lived in her Destrehan home for the past 16 years. She said under the new flood maps she will go from paying $1,400 a year to not being required to carry flood insurance at all. However, she will still pay for optional coverage at $220 a year.
Polutti said she feels bad for West Bank residents who may experience rate increases estimated to be much higher than what they are currently paying.
"When you are looking for a house you really aren’t looking at the flood insurance rates as much as you are the school system and the parish government," she said. "I feel bad for them. That’s crazy."
In contrast to Polutti, Billy Hayes, who lives in the Bar-None subdivision of St. Rose, said he paid particular attention to his elevation standards when he purchased his home.
"I’m 13 feet above sea level. I looked at that before I purchased 24 years ago," Hayes said.
Despite overall flood insurance rate decreases on the East Bank, Hayes said the rezoning would increase rates for his home and raise his rate $100 per year, which would cause him to pay $540 for flood insurance.
Sal Digirolamo, president of the Norco Civic Association, said although rates are mostly going down in his community he also feels bad for West Bank residents.
"I can’t imagine what the poor people on the West Bank are going through," he said.
District III Councilwoman Wendy Benedetto, who is a realtor and represents Destrehan, said the flood insurance rates will decrease in most of her district. Benedetto said she still is intent on working with the council to protect those in the rest of the parish.
"People that have never flooded before are going to pay astronomical prices. That doesn’t make sense," Benedetto said. "I am hoping and praying at the end of the day we can live with the rates."
While rates are falling for most on the East Bank, those in Montz will face higher insurance costs. Montz is not protected by the recently constructed East Bank levee. Mary Kenney said she lives just on the outside of the levee protection system and currently does not pay any flood insurance, but anticipates that will change.
"It makes me feel like somebody better give me a huge raise," she said.
Benedetto said immediately after the open house, the Parish Council contacted parish lobbyist Billy Tauzin in Washington, D.C. to formulate a plan on how to keep the maps from having such a negative impact on the parish. In addition, she said she will be talking to other organizations about lobbying against the maps.
"I, as a realtor, can talk to the real estate lobby and the homebuilder’s lobby," Benedetto said. "We are all pulling for this to not go through."
A town hall meeting concerning the flood map rezoning is scheduled for Monday, April 15 at 6 p.m. at Hahnville High School.
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