Disaster Savings Accounts Would Help Shore Up Homes and Finances

By Terry Sheridan, FLASH Consumer Blogger

Residents of Oso, Washington were traumatized on March 22 when a massive mudslide swept through the area engulfing homes and claiming lives.  Months later, residents are still handling the aftermath of this tragedy as best as possible, but the financial burdens of rebuilding often become as traumatic as the disaster itself.

Help could be on the way in the form of proposed federal legislation allowing homeowners and renters to set aside up to $5,000 every year in a disaster savings account – tax-free if the money is used for post-disaster repairs or pre-disaster mitigation.  The money rolls over every year and there’s no limit to how much can be accumulated.

If the Disaster Savings Accounts Act which is still wending its way through Congressional committees passes, homeowners and renters alike could establish accounts to use for future natural disasters.

“Disaster Savings Accounts would provide people the opportunity to protect their belongings and families,” says U.S. Rep. Dennis Ross (R-Fla.), co-sponsor of the bill with U.S. Sen. Jim Inhofe (R-Okla.).

While the Federal Emergency Management Agency (FEMA) and other government agencies provide limited relief to disaster victims, “… recovery assistance is after the fact,” Ross says. “We want to equip homeowners so that they can protect themselves before a disaster strikes and not when they’re forced to rummage through the remains of their homes after a flood, hurricane or earthquake.”

Ahead of a disaster, the pre-tax savings can be used to pay for home fortifications such as a safe room, wind resistant windows and doors, or elevating structures in flood zones.  After a disaster, savings can be used to help close the gap between insurance deductibles and other recovery funds.  In that case, the event must be a state or federally declared disaster and the homeowner or renter must have uninsured losses totaling at least $3,000.

“Insurance doesn’t cover all losses or cleanup expenses, particularly personal losses,” says former FEMA director James Lee Witt, Democratic candidate for the 4th Congressional District in Arkansas.  For example, if the bill was in effect at the time of the mudslide, Oso residents with accounts could have used them to cover uninsured personal casualty losses above $3,000 because they are in a formal disaster area.

Supporters for the bill come from all sectors, e.g. FLASH, The Home Depot, National Association of Home Builders, National Association of Insurance Commissioners, The Nature Conservancy and leaders like Moore, Oklahoma Mayor Glenn Lewis and former FEMA director James Lee Witt.

Editor’s Note: Terry Sheridan is an award-winning journalist who has more than 30 years of experience in reporting and editing for newspapers in the Chicago and Miami areas. She covered the aftermath of Hurricane Andrew’s devastation in 1992 in South Florida, and has experienced damage to her own homes from two hurricanes. She now lives in New Hampshire.

 

Preparedness Tips for Arthur

Now is the time to prepare your family and home for Arthur before the store shelves are empty and conditions are dangerous. FLASH offers the following tips for residents to prepare for severe weather conditions.

Protect Your Home

1. Check your hurricane shutters to make sure they are working properly and fit securely to ensure proper protection.

2. Go Tapeless! Never use tape on windows. If you do not have shutters, install temporary, emergency plywood shutters. Learn how to properly measure and install them.

3. Secure or relocate outdoor items such as trash cans, grills, toys and potted plants.  Remove any dead tree limbs carefully, if time permits.

4. Make sure all doors and windows are properly caulked and/or weather-stripped to reduce potential water intrusion, if time permits.

5. Replace rocks in your landscape with fire treated shredded mulch or other lightweight material, if time permits.

Prepare Your Family

6. Know if you are in a hurricane evacuation zone and have a plan.  Hurricane evacuation boundaries are based on the threat of water, not wind, and nearly all evacuation orders are issued due to threat of inland flooding and storm surge.

7. Make sure your 72-hour emergency kit is complete. Some items you should include:

  • Enough food and water for all members of the family, including pets
  • Extra cash
  • A battery powered NOAA Weather Radio All Hazards or download the FLASH Weather Alerts App
  • First aid kit and toiletries
  • Flashlights and extra batteries
  • Blankets, pillows, extra clothes, toys and games to keep the family comfortable and occupied
  • Special items for babies, pets and family members with special medical needs

8. Gather and store important paperwork like insurance and mortgage documents, and marriage certificates in waterproof containers. You can also scan copies and store them on a USB drive or take a photograph with your smartphone. Include these items in your emergency kit.

9. Fill your gas tank; gas stations rely on electricity to power pumps.

If You Lose Power 

10.  If you have space in your refrigerator or freezer, consider filling plastic containers with water leaving about an inch of space inside each one. This chilled or frozen water will help keep food cold if the power goes out.

11. Never use candles as they pose a fire hazard.

12. Don’t run a gas-powered generator inside a home or a garage – use only in well ventilated areas.

13. Connect only individual appliances to portable generators and never plug a into wall outlets. Plugging generators into the home’s electrical system can feed electricity back into the power lines and endanger both you and line workers.

For more information on protecting your home from hurricanes visit the FLASH hurricane page or Great Hurricane Blowout preparedness campaign.