Record Storm Threatens Flood Insurance Program

Claims from Hurricane Sandy could further threaten the deeply indebted federal flood insurance program that Ocean City property owners rely on and lead to dramatic changes in the future.

A report in the New York Times by Eric Lipton, Felicity Barringer and Mary Williams Walsh suggests Sandy will be the second most-costly storm in history in terms of claims paid.

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Read "Flood Insurance, Already Fragile, Faces New Stress."
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"Congress, just this summer, overhauled the flawed program by allowing large increases in premiums paid by vacation home owners and those repeatedly hit by floods," the New York Times reporters write. "But critics say taxpayer money should not be used to bail it out again — essentially subsidizing the rebuilding of homes in risky areas — without Congress’ mandating even more radical changes."

President Barack Obama signed a bill in July that extended the National Flood Insurance Program (NFIP) for five years, and the local real estate industry breathed a sigh of relief.