A federal lawsuit claims FEMA failed to take into account skyrocketing flood insurance costs generated by its new rating system, Risk Rating 2.0.

Ten states, along with 43 Louisiana parishes and more than a dozen levee districts, are suing FEMA, the Department of Homeland Security, and the Federal Insurance and Mitigation Administration to have the new rate methodologies declared unlawful. Those states are Florida, Idaho, Kentucky, Mississippi, Montana, North Dakota, South Carolina, Texas and Virginia.

Louisiana Attorney General Jeff Landry unveiled the lawsuit at a press conference in New Orleans on June 1, the official start of hurricane season.

“Risk Rating 2.0 flood insurance policy has now become a natural disaster of its own,” Landry said.

The lawsuit, filed in U.S. District Court for the Eastern District of Louisiana, alleges FEMA violated its statutory authority by using secret hypothetical events to develop and implement Risk Rating 2.0 while failing to communicate its rating methodology to the public.

Since Risk Rating 2.0 began going into effect in October 2021, some homeowners in coastal states have reported soaring flood insurance premiums. The new rating system is designed to be more fair and more precise, and to use a range of factors, not just a property’s location near a flood zone, advocates have said. While many sites’ flood premiums are rising, many have also dropped under RR 2.0.

But elected officials have heard from constituents whose rates have spiked.

Flood rates in Houma, La., southwest of New Orleans, will see the average premium increase from $982 per year to $3,511, according to ZIP-code data released last month by FEMA. In Florida, Key Biscayne will see flood rates as high as $7,000 annually on average.

Communities hit by historic flooding in recent years will see drastic price increases, too. Albany, Ky., will see prices increase from $741 to $4,597 on average.

Rate increases are limited to no more than 18 percent annually on renewals based on federal law.

The attorney general’s 112-page complaint claims FEMA rate calculations ignore important risk factors like the effect of levees on the likelihood of flood damage.

“Building levees, using pumps and other flood control measures should be calculated into these premiums the same way that your auto insurance calculates additional safety measures in the cars that you buy,” Landry said.

The lawsuit claims increased flood insurance costs will lead to fewer policies in force and less coverage in areas susceptible to flooding, creating greater risk for exposure.