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Market Indicators

IBHS Mid Term Update on Building Code Adoption & Enforcement Shows Mixed Results
In January 2012, the Insurance Institute for Business & Home Safety (IBHS) published Rating the States: An Assessment of Residential Building Code and Enforcement Systems for Life Safety and Property Protection in Hurricane-Prone Regions.

The Mid Term Update shows that since publication of the original report, most of the states with strong building code systems in place at that time remain committed to building safety; they have updated their codes to the most recent models, and in some instances, passed legislation to further strengthen code protections. By contrast, most of the states with very low scores in the original report have taken no action to improve their codes, thus falling even further behind best practices as reflected in the most current version of the model codes. For a copy of the Mid Term Report, click here to visit the IBHS website.

Rising Flood Insurance Rates Reflects Move to Risk-Based Insurance Rates
At the 2013 National Hurricane Conference in New Orleans, LA, FEMA Administrator Craig Fugate spoke extensively about changes in the National Flood Insurance Program (NFIP) that will produce significantly higher insurance premiums in the coming years. The increased premiums are part of an effort to create insurance rates that more accurately reflect the risk factors associated with building in flood prone areas.

For years debate has raged over the subsidized rates for flood insurance that many say have contributed to overdevelopment along the coast. According to Fugate, the increase in rates could be as high as thousands of dollars for second homes with lower increases for owner-occupied properties.