It called FRAUD
John Stossel talked about the government’s idiotic flood insurance on his show on the Fox Business Channel.
In this case (and in a roundabout way, many other cases), the entity causing the flooding (the FedGov) is also the one selling the insurance, making the rules about what/who is covered, when the coverage starts, and how much to pay in claims.
Conflict of interest... say it ain’t so...
My congressman has been pushing to stop the mandate that insurers use FEMA flood maps when they set rates. My house is in a floodplain that didn’t exist till FEMA decided it did.
http://walberg.house.gov/index.cfm?sectionid=79
FEMA needs to disappear.
They have been for years. FEMA is a giant .gov insurance agency that is broke and constantly looking for ways to sustain itself.
They often force homeowners who aren't even in a flood zone to buy their insurance. Another tactic they use is to redraw flood maps to put thousands of previously "dry" homeowners into flood zones. It's just a matter of moving lines on a map. If you have a mortgage, you're forced to buy the insurance - like it or not.
I know this because it happened in my area.
It's a scam. The "premiums" are used to maintain FEMA's massive budget and to pay disaster welfare by rebuilding homes that should never have been built in these REAL flood areas.
As usual, those who do things properly are forced to pay for the f***-ups. FEMA facilitates it all and gets their cut.