I purchased my home in 1994 and the cost of flood insurance at the time was $600. Over 13 years, my flood insurance policy increased to $1,033 annually. To date I paid over $11,461 to Fire Insurance Exchange over a 13-year period, when in fact I should have paid no more than $1,625; that amounts to an 70% increase even though I never placed a claim.
My home is located on the edge of a flood plain. A letter from the City of Thousand Oaks Civil Engineer concerning water intrusion into my home stated I could expect no more that 6 to 12 inches, further stating it would be standing water, not moving water. My home is 1490 Sq. Ft. and a contractor estimated a maximum cost of $25,000 to replace carpet and drywall if there were water intrusion. Based on the estimated cost of $25,000, the flood insurance policy should only cost $125.00 per year.
The 2007 /08 tax assessment of land improvement is $155,691, yet mortgage holders insist on coverage based on the total replacement cost of the home.
On January 28, 2008, I received notice from Wells Fargo Mortgage Hazard Insurance that my existing floor coverage increased from $224,000 to $257,000 increasing my flood insurance policy to $1,263 annually.
Can you imagine paying $1,263 a year for flood insurance when in fact I should be paying no more than $125.00 based on the damage I might incur?
FEMA recognizes that all floods are not alike. Some floods develop slowly, sometimes over a period of days. FEMA refuse to make adjustment for individual home owners who do not need insurance to cover a total loss and allows Insurance companies to rip-off the homeowner with excessive and over inflated insurance cost.