90% Flood Victims Didn’t Bother To Buy Subsidized Flood Insurance

The snowmelt in the Cascades has barely begun.  Floods are expected.  In California, the hydropower dams have so much water running through, they are producing too much energy for the rest of the system.  In various states in the center of the North American drainage system there are massive floods.  The latest is in North Dakota where rivers that are usually quite low in volume are flooding very badly.  This brings up the problem of flood insurance which is 100% a government function.


Just like insuring mortgages is now nearly 100%, too.  The insurer of last resort is increasingly, across the board, our government.  This is quite popular with the public.  The downside of this is, these insurance programs lose money, lots and lots of billions of dollars although this still doesn’t match the money losses we’ve taken on due to our massive war against Muslims.


Reinsurer Aspen Pegs Catastrophe Losses At $60M: the spring floods are expensive.  This doesn’t include tornado damage which has been extensive this year.  Some years, it is hurricanes.  Last year, we had little of that so instead, the bad weather problems showed up in the winter and spring with massive snowfall as well as floods.


This coincides with a rather active volcanic cycle combined with a strong La Nina cold water episode in the Pacific.  Volcanoes are major climate effectors both on the SO2 effects as well as fine volcanic dust making excellent systems for creating big rain drops in the stratosphere.  They also cool the climate, as we have seen so vividly this last winter.  If you collect snow during times of volcanic eruptions and then melt it, you end up with this fine dust that, when seen under a microscope, are volcanic in nature.  Fine farm dust can do this, too, if there is very strong winds that can carry dust to the higher stratosphere.  Nuclear bomb explosions are good for creating lots of fine dust and shooting it into the stratosphere just like a volcano.


Which is why the nuclear bomb tests in the past blanketed the planet with fine radioactive dust that collected mainly in downspouts and rivers and lakes as well as coating grass.  The Fukushima explosions did the same thing, too.

As per usual, people living in flood plains haven’t bothered even with buying this heavily subsidized and easily obtained.  Instead, even though the rules are, you can buy insurance within a month of the floods (and these floods were predicted last winter!), most people didn’t bother because it was probably one of those things people consider to be unnecessary.  So, here is the bad news:  Flooded North Dakotans Lack Insurance – NYTimes.com


But another problem facing residents of Minot is a consequence not of failing to control the river but of decades of doing so successfully: just one in 10 homes in the flood zone still have flood insurance.

“Some citizens have been lulled into a false sense of security because we have had such good results,” said Dean Frantsvog, the City Council president.

Michael Bart, chief of engineering and construction for the St. Paul District of the United States Army Corps of Engineers, said nobody could have anticipated a flood of this magnitude, with water levels almost six times what the system was designed to take…Federal emergency management officials urged valley residents to continue to buy coverage — even visiting a few months ago to warn that the reservoir levels were perilously high. But the number of people with insurance continued to drop. A year ago, 959 residents had flood insurance. This year it was 476, according to the Federal Emergency Management Agency.


90% of the homeowners had no insurance.  Amazing, isn’t it?  And the number of people who owed banks money on their houses and who had no insurance is probably around 70% or so.  That is, due to the recent modern strategy of the banks to hand out loans and then run off after selling them to some chump, in the case of today, the chump that ends up holding these badly-insured loans is the government via Fannie Mae.  Worse, the flood insurance is from Uncle Sam and all he asks is for some pittance way below costs.


I understand many Americans are being hammered by high fuel and food costs so they need to cut something and cutting insurance is one of those fatal things people resort to in times of high inflation.  Yesterday, I got a cold call from Chicago by a commodities trader who excitedly told me it was time to jump into the commodities markets.  HAHAHA.  I told him, I write about all of this and his voice sounded downright wounded when he asked me if I knew what was really going on.


Yup, commodity markets are now being suppressed by governments.  The G20 has decided this so of course, this guy was told to cold call anyone he could and hope they could unload all of their bets before the price falls suddenly.  They had to find chumps!


Here is a story about last month’s hearings on a bill to change the flood insurance rates:  25 to 50 percent rate hikes needed for federal flood insurance program 


Orice Williams Brown, a managing director for GAO, added that the program, already nearly $18 billion in the red, may have to borrow more money this year just to keep up with its interest payments…Brown said the devastating 2005 hurricane season exposed serious problems with the program, which typically charges inexpensive, government-subsidized premiums.

“Rates must reflect actual risk,” said Adam Kolton, a senior director with the National Wildlife Federation. “Currently, the NFIP insurance rates do not reflect actual risk … effectively subsidizing floodplain development and encouraging properties to be located in harm’s way.”


The government has to borrow money to pay for interest on programs run by the government in the red. Everything runs in the red now and the GOP wants to pass a law outlawing ANY government overruns!  HAHAHA…they caused these in the first place by cutting taxes while increasing spending!  And yes, these government goodies do encourage building in places where there are floods and hurricanes.


I live where there are none of these.  Instead, I get lots and lots of snow.  Our government basically says, I have to take care of myself when it snows so I spend money on a snow plow and I work very, very hard to remove snow all winter long and then heat my home via chopping firewood, etc.  Lots of work.  No money from Uncle Sam, not a penny.  And on top of this, my snow saves Florida and others from global warming.  I really want some subsidies for my efforts.  🙂

As per usual, Builders Back Reauthorization of Flood Insurance Program because it is ridiculously easy to build on flat flood plains where we should be growing crops, not building suburbs.  And of course, they make big bucks on fun in the sun sea shore homes where there is a 100% chance of a hurricane destroying things in the next 100 years.

No insurance company ever allows you to buy insurance only when you absolutely know you need it.  Otherwise, no one would pay a monthly rate for years and years!  Just wait until it is obvious you need it and you rush out and get it!  Of course, this is impossible.  And is why the government loses money.  They can’t have a one year waiting period for the insurance to  kick in.  Even so, with the flimsy deadlines where only really poor people or foolish souls can’t do it, this isn’t good enough for the free loaders.  They want NO limit in time. That is, you see the flood coming and run out and buy insurance that day and it nearly immediately goes into effect!  So, FEMA sets flood insurance start dates – KTIV NewsChannel 4 Sioux City IA: 


For those in the flood zone, FEMA has set what they’re calling the start date for the flood.  It’s June 1st.  That means to be covered by flood insurance, you had to have had it 30 days prior to that date.  It’s a date Nebraska Senator Ben Nelson isn’t completely on board with.

The fact that 90% of the people didn’t have insurance is reason why I say, the idea of building houses on flood plains while not piling up dirt hills to keep them above flood stage is a responsibility of the builders!  Sure, this adds onto the cost.  But it is saner and cheaper than losing the home in a flood.  This is what the government should enforce.  There should be laws about building homes on flood plains requiring they be on stilts or mounds.  Ancient people figured this out long ago, it isn’t something radically  new.  They figured this out in ancient Egypt, after all!



This isn’t a problem just in the US.  Here is news from Australia today about the lack of flood insurance in the Manning River basin:  Oakeshott calls for federal leadership on flood insurance — Manning River Times.  When I was a child in the desert, my grandaddy talked about the 100 year flood.  He explained how, if you build on the 100 year flood plain, you can expect a flood ANY TIME and even more than once in a hundred years.


These flood plains are easy to figure out.  Geologists can assist the government in forcing builders to build for 100 year floods or force whole populations to buy insurance at a proper rate to cover costs for these floods.  It takes many years of paying insurance to have enough money for the 100 year floods.  Exactly like in Japan where there was basically no insurance for 100 year Tsunamis.  That is, now they have to pay out of pocket.  But then, the government is run entirely in the red in the first place there just like here.sunset borger

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2 responses to “90% Flood Victims Didn’t Bother To Buy Subsidized Flood Insurance

  1. payAttention

    The government will not even raise the cost of capital enough to stop ‘the builders’ from continuing to waste our resources. 550,000 housing starts this year, in a time of real economic contraction, if you count out the build up of inventories for the past 18 months. Somehow, particle board on top of vinyl siding ‘construction’ is considered the lynchpin of the economic recovery. It is a strectch to call those capital projects, since I doubt any of these houses will last fiveteen years. A good three day storm and a few gusts over 50mph and the house turns back into glue and sawdust. However this is the type of genius that sets economic policy. The strip malls are a bigger economic pit. But someone keeps rolling over their paper, no matter what. Must be the smartest man in the world, because everyone else thinks he is a twit. Fooled us all.

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