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<br />002832 <br /> <br />In general, sound insurance programs at reasonable rates cannot be made <br />available in known fault-rupture, flood, and landslide areas unless the <br />premium costs are adjusted for the increased hazard. <br /> <br />Comparison to Flood Insurance Problems - Landslide insurance shares many of <br />the problems of flood insurance prior to the National Flood Insurance Program <br />(NFIP). Floods, like landslides, are a natural hazard that only occur in <br />certain parts of the landscape. Both hazards have a relatively low <br />probability of occurrence at individual sites, but higher probabilities of <br />occurrence in specific regions and states. Concern develops among state and <br />federal agencies that feel they are paying for disasters that could have been <br />prevented. As with landslides today, prior to the NFIP private insurers did <br />not generally offer flood insurance policies. The NFIP was enacted partly out <br />of concern that flood-related costs were not being internalized into the <br />market, and there were no financial disincentives to building in hazardous <br />floodplains. Hence, floodplains were being overbuilt, resulting in large <br />federal outlays in disaster prone areas. The same claim can be made in <br />relation to landslides and potential slide areas. <br /> <br />Key characteristics, however, distinguish flood and landslide hazards. It is <br />technically easier to identify flood hazard zones than landslide hazard <br />zones. Also, flood-prone areas, adjacent to navigable waterways, historically <br />have been the sites of major human settlements and centers of commerce. This <br />basic economic drive has not affected hillsides. Furthermore, it is easier to <br />design regulations and building codes to mitigate flood hazards than landslide <br />hazards. Flood 'hazards can be reduced by constructing levees or raising flood <br />elevations and strengthening supports. Landslides, by contrast, are more <br />complex and demand unique, and frequently expensive, solutions for each site. <br />Moreover, reconstruction is easier after floods. After a flood one need only <br />reconstruct the damaged structures. Following a landslide, however, one must <br />first stabilize the home site and/or remove debris deposited as a result of <br />the slide. <br /> <br />Federal and State Financial Assistance - Federal and state programs that <br />provide grants, loans, loan guarantees, tax credits, tax deductions, <br />depreciation allowances, insurance, revenue sharing, or other financial <br />assistance have a tremendous effect on public and private development. <br />Obviously, the enabling legislation for these programs can be amended by the <br /> <br />- 47 - <br />