Homeowner Insurance Policy Premiums May Increase By Up To 25 Percent In 2015

According to insurance industry experts, new insurance rates have gone into effect April 1, 2015, under the National Flood Insurance Program. What does that mean to you?  Michael Barry, a spokesman for a New York firm called, "Insurance Information Institute" states that a big surprise will come to policy holders in the form of an annual surcharge. He said that it may not be so much for the primary residence, who pays roughly $25, but for the second home. He says that the second home surcharge could be around $250.

Basically, the traditional homeowner insurance doesn't cover flood damage. Some say that the only way to get flood insurance is by federal coverage through an insurance company or agent.

According to records from FEMA, in 2014, the average flood insurance premium was $630 for homeowners. They say that the new rate increases come from the fact that FEMA is about $20 billion in debt because of helping with disasters like Hurricane's Sandy and Katrina along with terrorizing tornadoes through the mid-west.

So if you happen to see an increase in your homeowners insurance, don't be too surprised. The federal government is hoping that the rates will help to pay down some of the debt owed to the U.S. Treasury.