Just spoke to a friend who purchased a house after Katrina that did NOT flood in the Katrina affected area was 00 / year. Now rates are $ 4500 / year same coverage same company. NO CLAIM. WHat’s the deal? How can they do this? covers if the house floods. SO why are the rates so high?

What is everyone else paying in Louisiana and what part of Louisiana are you in?

I am looking to buy a home but cannot afford $ 375 / month just for .

 

  • Nate W 10:03 am on November 13, 2009

    The deal is, everyone is trying to file wind claims. Because the majority of people on the Gulf coast do not have flood insurance, this is the only way they could hope to get money.

    The insurance companies began to dispute these claims. Saying the damage was due to flood, not wind. The courts have now begun to mandate the insurance companies to pay, even on some claims that were blatantly flood damaged.

    The insurance companies are terrified that if another disaster like this struck, they would be left to fit the bill regardless of any exclusions (flood) they have in their Homeowner’s policies. So, to defend themselves from potential bankruptcy, they have begun to pull out of the area all together. Your insurance premium is very high, because frankly, they don’t want your business. It’s too much risk for them, thanks to your local court system.

  • christopherc 10:03 am on November 13, 2009

    Sorry, can’t answer your question but wanted to chime in with a good luck. Same thing is going on here in Florida, and well the State government seems to helpless on doing anything about it. Heard of one guy for $75,000 coverage is paying $1,800 a year and that is just for mobile home, one other was $125,000 she was paying $4,000!

    Good luck!

  • mbrcatz17 10:03 am on November 13, 2009

    Well, THAT house might not have had a claim, but in general, there were TONS of laims in LA! Additionally, there are TONS of court lawsuits pending, and juries are starting to hold regular homeowners insurance policies responsible for damages, even though flood is excluded!! So, the companies have to raise the rates to cover the claims.

    Insurance is all about SHARING LOSSES. So if one guy has a $100,000 loss, and 99 other guys don’t, EACH of them can expect the rates to go up $1,000 to cover the losses.

    The only consoliation – it’s worse in Florida.