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Living in a flood zone? Check your insurance. It may be about to go up. (+video)

A new federal flood-insurance reform law requires maps to take account of projected sea level rise in designating flood zones, as federal subsidies for properties in flood zones fade to zero.

FEMA Flood Insurance rate increases have local and state leaders on edge
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If you live on a coastline or in a river flood plain, check your flood insurance and where your home or business sits on the latest federal flood maps.

As of Oct. 1, the final stages of a 2012 flood-insurance reform law kick in, aimed at substantially reducing subsidies for federal flood insurance.

Premiums charged to most once-subsidized policyholders are slated to rise over the next four years, until the premiums reach the rate that reflects the true flood risk their properties face.

The Federal Emergency Management Agency (FEMA), which oversees the National Flood Insurance Program, began to phase out subsidies in January for policies on homes that aren't a policyholder's primary residence.

In October, subsidies will vanish for a range of other properties – from businesses and multifamily homes subject to repeated flood damage to property where insurance claims over time have grown to exceed the fair-market value of the property.

Subsidized insurance will still be available for about 715,000 properties, mostly single-family homes, notes Ray Lehmann, a senior fellow at the R Street Institute, a libertarian think tank in Washington that supported the reforms. But once a home is sold, or more than half of it is rebuilt after experiencing flood damage, or when new homes are built in flood zones, the unsubsidized rates will kick in. Rates also would rise if new flood maps show an increased risk for an existing home once thought to be in a safe location.

The drivers for reform: a flood-insurance program that is nearly $30 billion in the red, taking in premiums of some $3.6 billion; continued development along US coastlines and in other flood-prone areas; and global warming's current and projected impact on rising sea levels and weather extremes.


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