From Friday’s Insurance Journal:
Citing the risks exposed by Hurricane Katrina, a group of California Assembly Democrats unveiled legislation that could block some development in flood-prone areas and require homeowners living on flood plains to have flood insurance.[...]
A half dozen Democrats, including Assembly Speaker Fabian Nunez, D-Los Angeles, outlined a flood protection package that would use up to $6 billion in bonds plus property owner fees to pay for levee improvements and maintenance.
The legislation, some of it still in the drafting stages, would also require that before local governments approved new developments, they certify the developments have 200-year flood protection, or a one-in-200 chance of being flooded in any given year. Homeowners living in flood-prone areas without 200-year protection would be required to have flood insurance.
That’s not too terrible an idea, I think. Require the folks who live in harm’s way to purchase coverage, rather than relying on the dole that usually occurs after major natural disasters.
Of course, this does open up the cans of worms of affordability of coverage, particularly for folks who are living in flood plains because that’s where they can afford housing…and the potential for some spectacular lawsuits against developers when levees fail.
Still…it’s certainly an intriguing proposal.