WHEELING, W.Va. – A northern panhandle state senator says West Virginia is being proactive when it comes to mandated flood insurance.
Sen. Rocky Fitzsimmons, D-Ohio, sponsored a bill earlier this year that became law last week. It sets up a regulatory program for private insurance companies to offer flood insurance in the Mountain State.
The federal government has significantly subsidized the flood insurance program for years but that will end in three years and Fitzsimmons said when it does the state will be ready.
“That (federal program) extension actually is a positive. It will give us some lead in time. It will give time for the insurance commissioner to reach out to private insurers and let them know our expectations in West Virginia and get them comfortable with the concept,” Fitzsimmons said.
Three large private insurers have already announced they are going to be offering flood insurance in the future.
West Virginia residents suffered sticker shock in the last year when they found out what their flood insurance premiums would be without the federal subsidies. Sen. Fitzsimmons said it’s likely no private insurer will offer rates as cheap as the subsidy but they should be cheaper than the federal insurance without them.
“We think that through this private flood insurance plan they will be lower than they would eventually be under the federal government plan,” he said.
Fitzsimmons added he’s glad the new West Virginia program will have three years to get up and running.
“Those kind of things need incubation, they need lead time to develop. When you are trying to develop a whole new market that can be a challenge,” the senator said.
Since 1968, taxpayers have been subsidizing the NFIP to protect people who live in flood plains inland and those subsidies have also been used for vacation homes in coastal locations and other areas with increased flooding risks.
Because of actuarial discrepancies and storms like Hurricane Katrina, the debt for NFIP now stands at an estimated $24 billion.