"The federal government's flood insurance program, which fell $18 billion into debt after Hurricane Katrina, is once again at risk of running out of money as the daunting reconstruction from Hurricane Sandy gets under way."
"Early estimates suggest that Hurricane Sandy will rank as the nation's second-worst storm for claims paid out by the National Flood Insurance Program. With 115,000 new claims submitted and thousands more being filed each day, the cost could reach $7 billion at a time when the program is allowed, by law, to add only an additional $3 billion to its onerous debt.
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. 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."
Eric Lipton, Felicity Barringer and Mary Williams Walsh report for the New York Times November 12, 2012.
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