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Study: About half of homeowners in flood plains don't have flood insurance

WASHINGTON (AP) _ About half of the homeowners who live in federally designated flood plains do not have flood insurance, a nationwide study indicates.

But more single-family homeowners in the South _ including those in the hurricane-ravaged Gulf Coast _ are insured than elsewhere across the country, according to the RAND Corp. study released Monday.

The new data come as the Federal Emergency Management Agency prepares to issue flood elevation maps that will likely require more homeowners to carry insurance _ and, ultimately, dictate how hurricane victims are allowed to rebuild. The maps are expected in the next several weeks, FEMA spokeswoman Nicol Andrews said.

``There hasn't been very reliable information about the percentage of homeowners who have flood insurance, and that has big implications for what uninsured losses are like during an event,'' said RAND researcher Lloyd Dixon, who wrote the highly technical report on flood insurance rates in 100 communities nationwide. It surveyed 750 properties in each community.

Overall, between 50 percent and 52 percent of people who own single-family homes in flood plains carry such insurance, the study concluded. But it found that a quarter of homeowners whose federally backed mortgages require them to be insured against floods actually are not, and Dixon noted that compliance ``is not perfectly enforced.''

About 60 percent of homeowners in the South and West have flood insurance, compared with 20 percent to 30 percent in the Midwest and Northeast. Dixon said that gap likely reflects the few massive floods in those regions despite the widespread damage caused by the 1993 Midwest floods and a 1938 hurricane that killed 700 New Yorkers and New Englanders and left 63,000 homeless.

Unsurprisingly, the report found that homeowners in coastal areas are more likely to have flood insurance than those in landlocked regions. It also found that people in smaller communities are less likely to be insured _ possibly in part because ``there may be less appreciation of risk when there's just a small number of homes affected,'' Dixon said.

Additionally, while 62 percent of homeowners who have suffered flooding within a five-year period are insured, the rate dropped by half _ to 31 percent _ in communities that are only flooded once in a decade.

The RAND report did not examine insurance rates specifically in Louisiana or Mississippi, which suffered the most flood damage when Hurricane Katrina hit last Aug. 29.
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