In 1968, Congress created the National Flood Insurance Program (NFIP) to help pr
ID: 112742 • Letter: I
Question
In 1968, Congress created the National Flood Insurance Program (NFIP) to help provide a means for property owners to financially protect themselves. The NFIP offers flood insurance to homeowners, renters, and business owners if their community participates in the NFIP. Participating communities agree to adopt and enforce ordinances that meet or exceed FEMA requirements to reduce the risk of flooding. However, many argue that NFIP actually increases losses by skewing individuals perceptions of flood risk and encouraging new development in flood prone areas Do you think development in flood-prone areas should continue to be subsidized by the federal government? Why or why not?Explanation / Answer
NFIP is to provide flood insurance ti general public and was established for an effective flood plain management. Altgough every public who are under tgisnprogram pays the premium but when the real disasters occur, it cannot be a less amount for NFIP to pay in the form of insurance. There were instances in which NFIP into debts beacause of disasters like Katrina in 2005. In order to incur the loss they have to raise the premium and theres no other way. Taking this good program as ab advantage and developinh new houses and buildings in flood prone areas by the house owners or building owners to have a path for lumpsome amount by paying regular premiums is defenitely a wrong thing. NFIP shouldn't allow the premium holders to build new constructions in flood prone areas. If they are willing to build saying some reasons, then premium has to be more for them. They should be put into another group with either low interest rates or higjer premiums.