Lawmakers are facing a deadline to reauthorize the federal program providing insurance to homeowners when private insurers abandon their climate-battered locales. The 56-year-old program holds nearly five million policies and more than $22 billion in liabilities. It was envisioned as a stopgap measure for the working class — but the wealthy are now exploiting the program at the expense of low-income homeowners. That includes Trump’s Mar-a-Lago estate.
A 2020 study by the insurance consultancy Poulton Associates found that the program “provides a substantial subsidy to upper-income groups.” How? By charging lower-income households higher premiums than high-income households — even though the latter’s properties are generating far higher loss ratios (i.e., the difference between premiums paid in and claims paid out).
