A Franklin insurance agent pays about $900 for flood insurance on a rental home he owns in the city, but he expects that premium could quadruple in the coming years.
John Auld of Franklin Insurance sells flood insurance. He also faces rapid rate increases in premiums that other landlords, businesses and some homeowners can expect. The increases are happening because the federal government is eliminating flood insurance subsidies. Those subsidies help keep rates low for about 400 property owners in Johnson County.
The national flood insurance program, run by the Federal Emergency Management Agency, is $24 billion in debt. That led national lawmakers to implement the cuts in 2012. But those cuts were estimated to cause premiums for some property owners to increase by more than 10 times the initial cost in a single year. This month, President Barack Obama signed a law adjusting the effects of the flood insurance cuts to limit how fast the increases will occur.