WWL>Topics>>3-25-14 12:10pm Garland: on flood insurance

3-25-14 12:10pm Garland: on flood insurance

Mar 25, 2014|

Garland talks with Michael Hecht of GNO Inc. about the new changes to the federal flood insurance program.

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Automatically Generated Transcript (may not be 100% accurate)

I'm sure you've heard the good views but drum we've done any number of showrooms. Over the fact that. Flood insurance rates after Katrina proceed and he. We're going through the roof and a lot of Louisiana a lot of the country. We admitted he met called into the show or came into the studio. That would see insurance rates grew up 5101020000. Dollars a year. And a lot of those people felt like number one. They couldn't -- stay in their homes because they couldn't afford the insurance rates. End the current board sell their home presumably wanted to buy -- those kind of insurance rates. And nobody would even bid for their home. Because the mortgage companies wanted to refinance the company is at their houses or businesses at a higher rate. So it's extremely good news that the president President Obama signed into law or just recently few days ago. The compromise one interest build it rolls back all those dramatic increases. In the flood insurance traits. And although he won't say that of Michael -- and his crew and over to general he helped put together a regional national organization have a lot to do with -- Michael congratulations. A motive but you cup coffee or -- -- I can do is typical you know are on the -- blood you know where. That Cuba or reward ten months ago where instructions peace she didn't even know the problem. Or or oppose bid that don't know where we are and where would -- on now give some background and then explain what's that -- That sure like got a and edit text message from my board members. Back in -- and it's -- Michael you check out this and that thing. I didn't know what it was went on to the Internet and it looked pretty bad so that I really didn't believe it -- We get a little more digging it finally is that you know we wanna go why did -- -- And talked to the people who are behind the speaker waters -- figure out which -- ought. So we got in their group much we actually ended up adding I think fourteen. Our presidents and who went out there had a meeting Garland it was starting the -- sat down. With the person who actually had written the legislation staff pepper. This is going to be -- your legacy increases. Under they beat 300%. On what church and so it's it's. And we -- data reset -- -- -- that's not true. Here SC 2003000%. Increase is that it sizes now why. And that's when we hear that. Q should we have a problem in the world have a problem and mobile have a problem and so then we started out not advocating the first early educating. People in DC people across the country about the issue. And very quickly evolved into this coalition forces table one church to -- achieve. 35 states have got to ordered the organization's. Literally from Vermont Q why. And at that at that point. How many people do you think were affected in new museum. Arm in Louisiana you would have had potentially a war 500000. That would have been impacted. And and that small businesses to right. That is -- primary homeowners book remember that you -- -- orders. Rentals and vacation as well. And and my understanding is Louisiana. Had about 500000. Homes -- keep Porter who would wondered -- where the insurance policies a large percentage of that would have been affected right. I'll be that the vast majority deal one that actually might better. Strangely enough is those of us that are inside the new to two billion dollar. Floodwall which is -- New Orleans. Objections Saint Bernard the coast some of those rates actually -- -- troops. Under the for the vast majority individuals in Louisiana. Across the country. It would have meant anything from Italy small increase to you some examples were people were paying a few hundred dollars never flooded. Let's get their shirts they -- checkbook or the 151000 are such you know you're not that meant people lose their homes sent. You know kicking people out of their -- would have done nothing wrong -- economical Walsh said. I think bottle that was recognized by both sides apart in both chambers and not do their. -- remember correctly that the -- a new rights are going to be limited to. What was it seventeen and 18% per year. But that's a little bit misleading any kind of Google pack on that so a couple of things that -- -- -- like insurance portability act critical one. It's which grandfathered packets of Garland not mean that if you go out at the -- you elevations. Oh wait he credited -- generalities and even some maps change and that's critical player -- -- critical pure and trying to sell your. The other thing that it is that Paul -- -- taken away. Under bitter waters is that if you soldier how's the rate would immediately go hiring and so on these set -- results universally your house. So that taken away that's critical when you're fortunate is that kind of a little technical might make your radio -- let's get into it. Well specialized in that -- if the people people. This and where this is where you disagree. I'm not going to. Sun -- so look. And it matters to their rights for bigger Oilers to raise rates to 10% a year. Arctic waters so that you what you percent a year where Albert in the -- you 15% a year. But for an entire class all properties that are cult like air. Country -- -- he. -- team but -- for individual property the limit is 18% but there are a couple of things that -- ever in getting. The first is that people can orderly increase. Used that power increased. It's the entire class across the country is not actuarial averaged. And give an 80% of properties. Are at the actual -- average it's not like you're gonna ever get too far from that. At the bulk or on average so that's the first again mitigate it ever getting high. Or did -- give give them what Mort. Yeah and so if people want to use its right to go up to add up to 15%. It can only do that it's an entire. Last policy orders for example. All the policy holders that are eighty flood -- across the country. It's an entire class almost -- owners are not -- Yeah actuarial rates are not -- you right rate an entire class entire group. Homeowners. Now the thing is that all of the grandfathered properties are now regret are under our legislation are by definition. -- -- -- So that means that by definition. 80% of the property's already. At the correct rate. So in order to move off the average or below it for human actors make it out. It would have to be all those 40% of properties that are driving that -- So the point is just that it's unlikely for an entire be way off. The -- average. The second thing even more important that language in the bill -- that people. Will strive. To keep all policies at lest that 1%. Of the policy now. Another big on and get in the quarter and that means that the most expensive policy crisis. Would be 2005. Under. Of people fail orchestra I mean it's not legal. It actually -- team are on alert and -- you know how to report to congress every single property. Crosses that 1% threshold. So from a real political standpoint. But actually is real litigation against them or higher than 1%. Salute and there are some kind of real future -- why they're upset installed. But I'm confident about going on this radio shows I expect. Very properties see anything close to that 15% or Q percent individual. Interest. A little bit of -- there are also. Required to. Bible way language in this new law requiring FEMA flood maps -- act to grit and Romo and reliable. If I remember correctly we had to have the head of FEMA. Down here into our region. To walked him on the levees. To assure him. Bet there -- maps were in the electorate. What what keeps them from doing that again I mean it just seems. Basic to -- -- pure FEMA. In your making flood maps. You know and who has led his that a hire enough and who doesn't. And what a -- You know unfortunately Karl. You're not missing anything. Are we sure we had these -- By Pete down there's and it was walking on a levees that protected the edge during Isaak the predicted -- And according it -- it did not exist could not -- let. And the point of this is that in Cuba accurate maps and the program was being well good sign that good practice. We would be the discussion none of the law would have been at a port because the maps sort of an -- so. It's not for nothing about being called out in the legislation. The human needs to one. -- accurate maps which includes things like not struggle of these and -- affordability starting to be funded completed. For both forward and if that is in effect done and now it's been placed in the legislation. That all these other issues about -- to rise actuarial rates should become much less important because. The maps will be fully accurately credited for the mitigation elements so -- it. It's a very basic things -- a program so far based on that tea and that's -- -- Did did you say yeah dead dude there required. To find out here if the money into this works. Well there are required to do it affordability -- and what that guarantees it all argument that we're making. About how it's impossible for a middle class -- -- pay. 151000 -- for flood insurance. They actually are required to do a study to understand one what is the cost going to be to homeowners. Put in search across the country. And then to based on those findings design a program. That is simultaneously responsible. But doesn't throw people Robert Holmes. And -- whatever they come backwards. Shouldn't mess with a 15% increase a year should. -- know it shouldn't come -- -- change a law. And everything I've read. We're still billions of dollars and two in this emergency you are a caller. Blood program and that's not an important. -- waterboarding would you do we do about the deficit now. Well -- -- Q answers are there is a provision. In that program there could be surcharge of 25 dollar out all the shoot sixty proper business and that's going to help to a small degree. But the reality is that the way the program except right now it's not fool you a -- that 24 billion dollar should quickly. I'm that was really kind of the back story is not a picker waters in the results would appear that it actually would -- program worse but it would've wiped out. Policy ordered a program Politico the production Barroso it is fair question to raise -- a really -- -- it's another way to address the the bulk of that but that would -- to -- post it. Caused by Andy and Katrina. We're near Washington you're there you're any real ideas and how they might do that. And though you know that's been kind of pay. How we want to divide restore in the Middle East negotiations -- had you been it's been pushed it. So are you figures say that we've taken agreement between Democrats and Republicans who. So then we're maybe talk about of the real issues. Dream all right to go at eight months to draft of rules. Is there isn't any trends actions in the -- in the meantime buying a home selling home. Buying a second home. None of that suspected. And. Now owe it to the good news is not only is not that affected the conservative -- back well. Poll voters who either -- Part of bigger -- being in effect war who. Go and and win an appeal about the -- not being accurate they'll get their money back. So there is now reimbursement provision. So everybody should be kept whole regardless what happened in the past and much. And New York Times article that I was just informed is probably very incorrect. And says. National flood insurance flight is delayed to -- Talks about the widely hailed victory for the people that was -- their bills trouble quadrupled. Or even increased shifting pulled over by pocket paying permit and he is merely been delayed. -- says that is many of one point one million policyholders. Will still be hit with steady rate increases. Where you can. He you know mine. Collapse at an article but one should be accurate and the problem that he can. Hurt you. Mean. One out in one of its interpretation. The fallacy that the art economy. Says. -- thirty -- he's gonna require seem to repay the 24 billion dollar deficit rate increases. The reasons we discussed that's not possible archer. The second is that there are in their calculations that Wall Street -- properties about you know it's a total properties. -- will it be it within 18% increase. Into the future and for all the reasons we discussed. Including the including the 1%. A rule in fact -- the any fact that we're real life years anyway. I mean that very few of those one. First organist ego level increase so it is -- What that article saying there is not technically incorrect in the technical interpretation of this law. In practice I think -- -- vast overstatement. So we're losers owners of a quarter million dollar business. -- second almost see the road rise. 25%. Each year into the premium. Reached records that matters that true risk of flooding that's incorrect. What accurate that neither one aspect that it is correct there it's. Important get for cheer. All primary homeowners are protected by the law -- at all you want. Or or -- -- making -- victory war literature interest -- the only group that is currently not impact by what we just passed. Is people who owned businesses. Second homes or severe and lost properties that were built generally before making seven victory. Those properties and for reasons which are technical. Or shall what to score them. Are going to see up to those 25% increase his. Or at least the next three years until we get cute real -- legislation so that is particularly true. Chicken or orders. They're number at a political reasons why I like about that way that they are any issues director dressed venture. I cannot believe -- -- trying to tell me that some in the media bright things are correct and it shocked. Dismayed and a little bit depressed but that's -- right it is -- Where do you feel that the unions. Euro mills wouldn't was told I had to let you go it went by chapter is about 2530. Non. I'm 39 seconds more than your stamped him. Well I've got to go you know to election they it marked departure. Like that. I agree. Good good talking to Michael and thank you for what you're doing it for this community board one -- couple. Or have a good day. Until it is it gets interesting that doubts. I find that fascinating because as this New York Times you know it's one of the big media outlets and we just got through. Doing. A show. On the new media and they're being. Paid for collects are being paid for house startling. The show is and so forth and so on and -- go another example of the writing of this story. That's written in such -- at least so forum would check with the congressman. And except power is generated or totally wrong. Let's go to John in Metairie John Durham doubled to open config break story coming right back.