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Local News

March 31, 2014

Locals face spiking flood insurance costs

Scores of people lost their homes in the floods that ravaged parts of Schoharie and Greene counties in August 2011, and many of them had no insurance for such a calamity.

David Rikard, a Prattsville attorney whose Victorian home on Main Street was swept from its foundation by cascade of raging water, was one of the fortunate ones who did have federal flood insurance protection.

With his insurance money, Rikard was able to rebuild in Prattsville, this time on higher ground. But in order to qualify for a mortgage, he still had to have flood insurance, a requirement he said makes perfect sense.

But Rikard and other flood insurance policy holders throughout the nation are about to face sticker shock on their premiums, as the result of an escalation of rates for the coverage.

He is one of an estimated 60,000 New Yorkers who are among the 1.1 million policyholders nationwide expected to be socked with premium increases as the result of alterations to the National Flood Insurance Program.

The homeowners are expected to see increases of 18 percent as the federal program seeks to bring financial balance to an effort where the collected premiums has been dwarfed by the payouts after such storms as Hurricane Katrina, Super Storm Sandy and Hurricane Irene.

“I really think this is unfair because you don’t have any bargaining power in this,” said Rikard. “They set the rates and you’re stuck with them.”

He said he’s not complaining about his current premium on the new property — approximately $870 a year — as it’s far less than the $2,400 a year he had been paying for the house destroyed by Irene. The new building qualified for a lower rate because of flood mitigation measures in its construction.

According to an analysis of federal flood insurance data by the Associated Press, the increases in the premiums are expected to hit more than 700 property owners in Delaware County. The data was incomplete for Otsego and Schoharie counties, but the figures that were available showed 19 homeowners in Oneonta are facing increases. In Schoharie County, the higher rates are expected to hit 48 Cobleskill homeowners and another 35 in Middleburgh. In the tiny Greene County town of Prattsville, 26 policy holders will pay higher rates, according to the AP data.

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