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How Much Will Hurricane Irene Cost You?

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  • Description

    FBN’s Gerri Willis on the financial implications of Hurricane Irene.

  • Duration 3:26
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Well people are debating just how much hurricane -- -- low cost and the estimates are all over the place some say two billion dollars others say the number could reach as high as 35 billion dollars.

New Jersey governor Chris Christie is said the costs of -- -- alone can be tens of billions of dollars.

Look regardless what you should be asking tonight is how much is it gonna -- meet.

And the answer could be more than you think first stop as we mentioned earlier if you happen to be one of those folks with damage from the storm.

It's possible some insurers will charge what they call a hurricane deductible.

Rather than the standard deductible before they start paying out your claim.

And that could mean the difference between laying out 500 bucks and thousands of dollars.

That's -- hurricane deductibles are figured as a percentage.

Of the total insured value of your call like we describe.

-- new York and New Jersey real estate is pretty expensive compared to rest of the country you can bet locals could be -- -- a lot of -- before their coverage starts.

But we pay in other ways as well.

First stop the National Flood Insurance Program isn't deep trouble.

Hurricane Katrina virtually bankrupted the -- -- federal insurance program which has been lurching from one federal cash infusion to the next to make ends meet.

Bring -- don't reflect the cost to pay out -- for that reason the program is like a friend who always asked for alone but it's never gonna be solvent.

Even now it has its -- -- asking for an extension the program goes out of business September 30 unless congress acts.

But there are other programs out there that have a call on our tax dollars.

These are programs developed by states to pay claims on high risk properties those that are difficult to -- and pretty expensive -- -- Originally these programs called fair plans or residual plants were developed to help urban property owners who couldn't get insurance but increasingly.

The point -- help don't help -- they help well to do owners of beach front homes get coverage.

Many of these programs can make claims on states to fill their koppers when they run out of money.

And they had a history of problems.

Of the thirty want their plans for which data is available 28.

Haven't heard at least one operating deficit since 1999.

The state can issue bonds to fulfill those claims -- you get the picture Graham on the Berkshire's ends up paying part of the cost of a Cape Cod luxury -- Very fair.

-- these programs are growing like topsy just 900 policies were issued in 1990 but last year the figure had more than triple the 2800.

These policies now guarantee 750 billion in losses from 55 billion in 1990.

More more these programs aren't the last resort for homeowners they're the first choice for homeowners.

-- -- -- Political pressure politicians don't wanna raise premiums on voters -- -- artificially low and ultimately all of us taxpayers or risk.

Nowhere is this more evident than Florida -- the State's insurance programs are occasionally solvent and require state bailouts by issuing bonds that are paid for with state tax dollars.

Recently the head one of the programs says it's unlikely the reinsurer will be able to meet current obligations.

Ultimately insuring people with pricey beachfront home should be paid for by.

People with pricey beachfront homes and not by everybody else.

Look what the -- reminds me out and open government obligation an entitlement program that we don't even think of as an entitlement program.

-- one that should be ended.

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