Flood insurance can be expensive and it can also be cheap. So what is the difference when it comes to flood insurance in Homewood Alabama?

Let's discuss three things that could impact flood insurance rates in Homewood Alabama.

  1. Age of the home
  2. Foundation of the home
  3. Floodways

 

Age of the Home

A home in St. Stephens Green in Dublin, Ireland.

Let's look at the age of the home first, what impact can the age of the home in Homewood Alabama have on your flood insurance rates.

Well let's discuss two different programs with the National Flood Insurance Program to get a better understand of the impact age of the home can have on flood insurance rates.

Under the National Flood Insurance Program there are two types of structures.

  1. Pre-Firm
  2. Post-Firm

Pre-Firm structures are structures that were either built before the first flood map or after 1974 which ever one is later.

Post- Firm structures are structures that were built after the first flood map.

The first flood map for Homewood Alabama was March of 1973 so post-firm structures in Homewood Alabama would be after December 31, 1974.

Now that we know the difference between pre-firm structures and post-firm structures in Homewood Alabama lets discuss how the rates are different.

Since pre-firm structures were built before the first flood maps they have access to subsidized rates.

So what are subsidized flood insurance rates? According to FEMA these are flood insurance rates that are charged to a select group that would not cover expenses and claims.

In many situations these rates are half what they should be. Different subsidized rates apply to pre-firm structures than they do post-firm structures. There are a few things that could change a pre-firm structure to a post-firm structure. Those two things are buildings being

  1. Substantially improved
  2. Buildings having additions

 

Homewood Alabama is a very hot real estate market because of location. This area has alot of historic buildings. As this market gets hotter and hotter many people are improving these properties and making additions.

So let's first discus substantially improved properties. These are properties that have had more than 50% of the market value in renovations within a given year. If a Homewood property has had this done then the date of construction would change from the original date to the date of renovations.

This can have a huge impact on flood insurance rates as it removes the property from certain subsidization flood insurance rate programs.

Properties in Homewood Alabama having additions put on them also follow the same guidelines. Once an addition is added to the property then the year of construction now changes to the year of the addition. This also removes the property from certain subsidization flood insurance programs.

Now that we have an understanding of how age of the home can impact flood insurance rates, lets discuss foundations.

 

Foundation of the Home

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Foundation of a home can be one of the leading factors when it comes to flood insurance in Homewood Alabama. Let's discuss 4 basic types of foundations that the National Flood Insurance Program and private flood insurance look at in Homewood Alabama.

  1. Slabs
  2. Crawlspaces
  3. Basements
  4. Elevated buildings

 

Slab Foundations

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Slab foundations are foundations that are concrete poured. These foundations are not below grade as a result many times flood insurance rates can be better on these properties depending on what the base flood elevation is.

Crawlspace Foundations

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Crawlspace homes are an under-floor space that has its interior floor area (finished or not) no more than 5 feet below the top of the next-higher floor. There are two types of crawlspace homes.

  1. Above grade crawlspace
  2. Subgrade crawlspace

The difference in flood premiums for these two types of crawlspaces can be huge. One reason is that subgrade crawlspaces are below ground and above grade crawlspaces are not.

Above grade crawlspaces can allow for certain mitigation efforts like flood vents where the crawlspace area does not have to count as the lowest rated floor.

Subgrade crawlspaces do not have these same benefit since they are underground.

Basements

Billard table in a corridor of modern house

According to FEMA basements are homes where all four sides of the home are underground. There are two types of basements in Homewood Alabama

  1. Full basements
  2. Walk out basements

Full basements are basements that fill the entire area under the house, rather than just part of it.

Walk out basements are basements that incorporate a wall with doors and windows on the ground level.

While the NFIP does not charge differently for these two types of basements in the Homewood area, private companies do use it in their determination of rates.

Walk out basements can create a different flood exposure because of the entry way around the subgrade area.

 

Elevated buildings

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Elevated buildings are similar to homes in Homewood with above grade crawlspaces. However according to FEMA the difference between these two types of properties is the distance between the crawlspace and the next floor.

If its five feet or less its considered a crawlspace, once it passes five feet then it becomes an elevated building.

All these foundation types can impact flood insurance rates in Homewood Alabama. The biggest factor they have is how far below or above the base flood elevation. The more negative the higher the flood insurance rate. The more positive the building elevation is the lower the flood insurance rate. A positive elevation above the base flood elevation can also possibly make the property a good candidate for the property to be removed from the flood zone.

 

Floodways

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Regulatory floodways are the channel of a river or other watercourse and the adjacent land areas that must be reserved in order to discharge the base flood without cumulatively increasing the water surface elevation more than a designated height.

The South Shades creek floodway can have a big impact not only on flood insurance rates but also flood insurance options in Homewood Alabama. While the NFIP does not use floodways like South Shades creek in determining rates the private flood insurance market does.

Many private flood insurance companies will not insure properties that are located within the floodway. The private flood companies that do generally charge a much higher rate.

While your property may not be currently in a floodway it could be moved to one when flood maps are updated. This could result in having your private flood insurance in Homewood Alabama cancelled.

So if you have questions about how the age of your home, the foundation of your home, or floodways in Homewood Alabama are impacting your flood insurance rates then please reach out to us. You can visit our website Flood Insurance Guru for flood education resources. You can also visit our YouTube channel or Facebook page The Flood Insurance Guru where we do daily flood education videos.

 

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Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

There are three government roles in the disaster assistance process. As shown below they are local, state, and federal government.

Local

Atlanta, Georgia, USA downtown over the interstate highway.

State



Massachusetts State House which is located in the Beacon Hill neighborhood of Boston is the state capitol and house of government of Massachusetts.

 

Federal

 

The White House on a beautiful summer day, Washington, DC.

 

In this podcast we are discussing the role local officials play in disaster assistance. When discussing disaster assistance in this podcast we are specifically addressing individual disaster assistance

What is individual disaster assistance?

Individual disaster assistance helps with crucial things like dental care, medical care, housing expenses, and even burial expenses.

Happy volunteer family separating donations stuffs on a sunny day

When comes to a disaster local officials are the first ones on the scene and the last on the scene. They see the needs of a community during the disaster and after the disaster.

So when it comes to getting individual disaster assistance for the community these individuals can play a critical role in whether a community gets approved or not.

Here are some common roles a local community official plays

  • First one on scene
  • Hands on the community daily
  • Last on the scene
  • Community liaison to the state

 

Group of happy young  business people in a meeting at office

 

As mentioned above local officials play the role of community liaison to the state. Residents depend on the right information being sent to the state to help the disaster assistance case. Stay tuned for our other podcasts that discuss the role of state officials and federal officials.

 

If you have questions about flood insurance or disaster assistance make sure to visit our YouTube channel or Facebook page The Flood insurance Guru where we do daily flood education videos. You can also check out our regular flood blog and our flood map update blog.

 

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Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

You hear the word flooding and desert then you are probably laughing. However areas like Arizona average 40-100 floods a year. Now majority of this flooding occurs during monsoon season. We want to discuss what is a monsoon? When is monsoon season? and What are the flooding dangers of a dry monsoon season?

Arizona Monsoons

So what is a monsoon?  A monsoon is traditionally defined as a seasonal reversing wind accompanied by corresponding changes in precipitation, but is now used to describe seasonal changes in atmospheric circulation and precipitation associated with the asymmetric heating of land and sea.

Monsoon season in Arizona generally runs June 15th to September 30th. Arizona receives most of its rain during monsoon season but most of it usually falls in the month of July. So how much rain is it? Well on average Arizona receives about 12 inches of rain a year.  You wouldn't think this would cause much of an issue but parts of Arizona like Scottsdale and Phoenix have a base flood elevation of one foot. This means that flooding could be an issue with less than an inch of rain. Now you can see why this area has 40-100 floods a year. So what happens when there is a dry monsoon season.

 

Risks of a Dry Monsoon Season

Arizona is experiencing one of its driest monsoon seasons ever. While this makes some people happy it can create additional flooding exposures. So let's talk about some of those impacts.

No flash flood today Dry stony bed of Silver King Wash in Boyce Thompson Arboretum State Park, about 55 miles east of Phoenix, Arizona

  • Mudflows
  • Mudslides
  • Redirection of water runoff
  • Risk to drinking supply

 

When a dry monsoon season occurs it makes the Arizona area even dryer than before. So when it does rain it can be like water running down cement because it's so dry causing more flooding to lower lying areas or areas that are in an AO flood zone. This can also cause mudflows, this is an area fluid or hardened stream or avalanche of mud. It can cause mudslides as well. These are  a common type of fast-moving landslide that tends to flow in channels. It's important to know that mudflows are covered under flood insurance but mudslides are not.

 

When an area does not see water runoff for a while and then large amounts of it during a short amount of time it can create issues. This is where flash flooding occurs and water has to redirect itself because there is no where for it to go.  This can cause flooding in many areas especially like Lake Pleasant which serves as an important water source for Maricopa, Pinal, and Pima counties.

 

Monsoons can cause serious damage through Arizona as we have seen through the years but the lack of monsoons can cause just as much damage. Proper amounts of rain are needed to properly manage flood plains throughout Arizona. 

If you have questions about how monsoons are impacting your flood insurance options in Arizona you can visit our website Flood Insurance Guru. You can also visit our YouTube channel or Facebook page The Flood Insurance Guru where we do daily flood education videos. You can also tune into our weekly podcast The Flood Guru.

 

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Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

In late August of 2019 areas of Birmingham Alabama like Hoover, Indian Springs Vestavia, Pelham, Alabaster, and Inverness experienced flooding. Why did these areas of Birmingham Alabama experience flooding? Those that suffered flood damage what options are available for flood coverages?

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On August 23rd 2019 Birmingham Alabama experienced large amounts of rainfall that came from a low pressure system from the Gulf of Mexico. This system dropped 3-6 inches of rain in short amount of time causing flash flooding in areas like Pelham, Hoover, Leeds, Moody, and Birmingham Alabama. The drainage systems could not handle this amount of rainfall in this period of time cause drainage systems and roads to collapse. While flash flooding only lasts a short amount of time sometimes only hours the damage can last forever.

So when this occurs what coverages apply? Well lets discuss two areas where coverages could apply

  • Home Owners
  • Business Owners

 

When it comes to flood insurance coverages for property owners in Birmingham Alabama you will have three types of coverages depending on the policy you have.  So what policies are available? Well there is the National Flood Insurance Program and private flood insurance.

 

National Flood Insurance Program Coverages

The National Flood Insurance Program offers two types of coverages on their policies. Before we discuss those coverages let's discuss exactly what this program is. The National Flood Insurance Program also known as NFIP is the government regulated flood insurance program. They set the guidelines for the program, the rates, and the coverages available. So let's discuss the two coverages they make available in Birmingham Alabama.

You have building coverage and contents coverage. First let's look at flood insurance building coverage for property owners in Birmingham Alabama. This type of coverage is going to cover the actual structure and things that make the structure safe like servicing equipment, circuit breakers, and stair wells. Its important to understand that under the NFIP detached structures are not covered under the main structure. 

Under the NFIP guidelines each detached structure requires its own policy in order to be covered. Its also important to understand that if it is not a primary residence there is a $250 surcharge for each building. The NFIP also maxes out coverages on buildings at $250,000. Now let's discuss contents coverage under the NFIP.

Under the NFIP contents can be covered. This is going to cover things like appliances, furniture, and clothing.  Contents coverage with the NFIP is maxed out at $100,000 on Birmingham structures.  It's also important to know if you are filing a flood insurance claim in Birmingham Alabama that you will have a separate deductible for the building and a separate deductible for contents. So when picking deductibles consider as this could be a pricey mistake.

 

Private Flood Insurance Coverages Birmingham Alabama

The other option for flood insurance in Birmingham Alabama is private flood insurance. What is private flood insurance? This is flood insurance that is backed by private insurance carriers. The private companies set their own rates, guidelines, and the availability of the flood insurance. While NFIP flood insurance is always available private flood insurance companies do put moratoriums on access of it. We have seen this for the majority of the year in areas like Iowa, Nebraska, and Oklahoma.

So what coverages are available under private flood insurance. Well private flood insurance offers technically 4 types of coverage

  • Building coverage
  • Contents coverage
  • additional living expenses
  • Business loss of use coverage

 

Like the NFIP private flood insurance offers building and contents coverage as well. There are just some differences they don't limit flood insurance coverage in Birmingham Alabama to $250,000 on building and $100,000 on contents. So if more coverage is desired it is available. Depending on if you are a home owner or business owner private flood insurance offers additional living expenses or business loss of use.

Additional living expenses are there to help cover things like a hotel if your home is not livable while being repaired. Business loss of use helps cover regular business expenses while your Birmingham business is recovering from a flood.

 

So if your home or business as been flooded or you are concerned about flooding in Birmingham Alabama you can visit our website for more information Flood Insurance Guru. You can also visit or YouTube channel or Facebook page The Flood Insurance Guru to view other flood education videos on Birmingham Alabama.

 

Start My Flood Insurance Quote

Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

 

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2019 has been a year to remember for the seven states that touch the Missouri River. Montana, North Dakota, South Dakota, Nebraska, Iowa, Kansas, and Missouri have seen Missouri River flooding like never before.  Web want to address three major concerns

What Has Caused the Missouri River Flooding?

When Will the Missouri River Flooding Stop?

How Will the Missouri River Flooding Impact Flood Insurance Options?

missouri flooding

 

What Caused Missouri River Flooding?

So what has caused all the flooding on the Missouri River? It all started in late 2018 and 2019 with record amounts of snowfall along many areas of the Missouri River in Nebraska, Iowa, Kansas, Minnesota, South Dakota, and North Dakota. This snow has to have some where to go. Normally it gradually melts over about a 2 month period. However 2019 was a little bit different.

 

In the early spring of 2019 the Midwest was hit with a bombogenesis, or a bomb cyclone, an epic drop in air pressure that triggers historic weather. That rapidly increased this snow melt to a matter of weeks. The combination of rainfall and 30 inches of snow that had fallen earlier in February in areas like Omaha had  created some disastrous flooding situations in areas like Nebraska City Nebraska, Kearney Nebraska, and even areas like Des.

 

Normally this water could have runoff into tributaries but those areas were still full from heavy rains in the fall. As a result the water had no where to go making the Missouri River rise like it had not in more than 50 years. What made things even worse was that with it being an unusually cold winter layers have ice had built up in many lake and river areas. As the bomb cyclone came through it caused the layers of ice to break apart causing ice log jams along the Missouri River. This caused many low risk areas to flood that normally would not have flooded.

 

When Will the Missouri River Flooding Stop?

The Missouri River will soon be cresting for the 5th time in 5 months. So when will the flooding stop? A very wet spring combined with an early wet summer has made residents wonder if it will ever stop. Flooding can not just stop over night it can take months for the water levels to go down as the land simply can not absorb that much water. When you are dealing with flooded areas like Nebraska City Nebraska  are very flat it takes longer for the water to go away. You also have to wait for other rivers waters levels to go down so the water has some where to go.

 

Missouri Flooding Impact on Flood Insurance Options

One flood after another in 2019 has definitely impacted flood insurance options in Nebraska, flood insurance options in Missouri, and flood insurance options in Minnesota. However many people do not even know what flood insurance options are available on the Missouri River.

There are basically two flood insurance options available the National Flood Insurance Program and private flood insurance. The National Flood Insurance Program also known as NFIP is the government regulated program. Coverages and rates are set by the federal government.

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Then there is private flood insurance which many people did not know was available. Private flood insurance is flood insurance that is backed by private flood insurance companies.

 

Now that we know the two options for flood insurance in Nebraska, Minnesota, and Missouri lets talk about the impacts the Missouri River flooding is having on them. First of all it is not impacting the availability of flood insurance through NFIP at all. As flood insurance through NFIP is always available and does not do moratoriums just a standard 30 day wait period. The big impact is on the private flood insurance side. When disasters like the Nebraska flooding of 2019 hit private flood insurance companies can stop making flood insurance available or even skyrocket rates. This is exactly what happened in areas of Nebraska and Iowa. Certain private flood insurance companies have not made flood insurance available since the end of 2018 creating one of the biggest moratoriums in private flood insurance history.

As a result it has had a big impact on closings for mortgage companies, property owners being forced into higher NFIP premiums, and higher coverages not being available. However as the Midwest heads into dry season companies are optimistic that flood insurance policies will soon be available once claims start coming in. However each time it floods its like starting over.

 

So you can see the Missouri River flooding has been a historical event for a few months, its limited flood insurance options for property owners, and caused catastrophic damage.

If you have further questions about the Missouri River flooding or what the flood insurance options are in Nebraska, Missouri, Minnesota, or other parts of the Midwest please visit our website Flood Insurance Guru. You can also check out our YouTube channel or Facebook page The Flood Insurance Guru where we do daily flood education videos. You can also listen to our weekly Flood Guru podcast or join our open facebook group Flood Education and Flood Insurance Awareness where we answer flood questions everyday. You can also click the link below to learn more about flood insurance options.

Start My Flood Insurance Quote

 

Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

Flood insurance premiums can quickly get out of control and people are always looking for ways to minimize these premiums. We want to talk about one major way people are doing this, which is raising a home.

Raising the Standard

Raising a property can be very expensive but areas like New Jersey and Houston Texas have shown us that this could have helped minimize flood damage. Its not unusual for it to cost $100,000 to raise a home. Many people would think that there is no way that this could ever pay for itself, but there are FEMA mitigation grants that can help.

Let's compare a couple of things the average amount of disaster assistance and the average amount of flood insurance paid out during Hurricane Harvey. On disaster assistance an average of $4000 was paid out and on flood insurance the average amount paid out was $140,000. That's just one flood disaster what about areas that see this situation over and over again. As you can imagine raising a home could quickly pay for itself especially in coastal areas like Galveston Texas and areas like major rivers like Memphis, Saint Louis, and Des Moines.

The Central Avenue Bridge and skyline reflecting in the Mississippi River at night, in Minneapolis, Minnesota.

It's Not That Simple

Raising a home just isn't that simple. As mentioned before it can be pricey but then there is also the guidelines. For example if your property has flooded then you could get a portion of this paid for as long as the policy limits on the National Flood Insurance Policy are not exceeded. 

Raising the Expectations

Each foundation type has its own guidelines, in addition servicing equipment needs to be disconnected before starting the process. It also needs to be determined how much to raise the property. You will want to make sure that the lowest finished floor is as far above the base flood elevation as possible. When raising the home it would also be recommended to be on piers, posts, or enclosures. This would keep water moving underneath the home preventing hydraulic pressure from building up and causing serious foundation damage.

Raising a home can be stressful with the costs and different guidelines. If you have further questions about the impact this could have on your flood insurance premiums please visit our website Flood Insurance Guru. You can also check out our YouTube channel or Facebook page The Flood Insurance Guru where we do daily flood educational videos as well as our weekly podcast The Flood Guru.

Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

Low interest rates can be a great thing for people purchasing homes or refinancing homes. However long term low interest rates can be bad for company profits. They can also have a big impact on flood insurance premiums. 

Impacts of low interest rates

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As mentioned before low interest rates can be great for people purchasing homes or refinancing homes. However long term low interest rates can have a big impact on the bottom line for insurance companies. Most companies that take money for services are looking for ways to invest these dollars to help their bottom line and growth. When interest rates are high these companies can make a lot of profit for the company. This is big for flood insurance companies because it allows them to keep rates stable. 

However when rates stay long term combined with alot of claim payout it can create a very unstable market. What happens is they are not making the money on their investments the way they need to and they are paying out a lot of $$$ for claims. As a result this has a big impact on the profits for not just private flood insurance companies but really any insurance company. As a result they have to find other ways of generating revenues and making sure they can pay these claims out.

Will Flood Insurance Rates Change

So many times the only other area for them to generate these $$$ is by increasing flood insurance premiums. 2019 is creating one of these possible situations with interest rates going down and flood insurance claim payouts being very high. So when your flood insurance comes up for renewal this is something you will want to pay attention to, especially if you live in areas that have been hit by flooding.

Some of the areas that could see the hardest hit from this might be Nebraska City, Nebraska, Tulsa Oklahoma, areas around Lake Keystone, and Fort Smith Arkansas.

 

If you have questions about how this might be impacting you please visit our website Flood Insurance Guru for more information.  You can also check out our YouTube channel or Facebook page where we do daily flood education videos.

Start My Flood Insurance Quote

Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

Today we are discussing if FEMA or the NFIP can non-renew a property owners flood insurance policy.  If they can non renew it what are some reasons that would cause this to happen.

First of let's briefly discuss the National Flood Insurance Program or the NFIP. This the federally regulated flood insurance program. Rates and underwriting are set by FEMA or the government. Now let's discuss what is a non renewal? NFIP does their flood insurance policies in 12 month increments. So what a non-renewal would be is them not continuing coverage after the initial 12 months. So can the NFIP non-renew a flood insurance policy?

 

NFIP Non-Renewal Reasons

NFIP can non-renew a flood insurance policy if certain guidelines are not followed. All these guidelines would fall under what is called a provisional rate. A provisional rate is a flood insurance rate that is given based on the information that is known, but more information is needed to guarantee the rate. A provisional rate is only guaranteed during the first term of the flood policy. The provisional rate could be good for maybe 90 days or even 12 months. Generally NFIP gives a set time period to get items in for this provisional rate.

fema_orig

So what things might be needed to take a provisional rate to a set rate? In many situations there are generally two things that cause a provisional rate. That is the lack of photos and an elevation certificate. So why would these things be needed to secure the correct rate? Well generally NFIP wants a picture of each side of the structure. The reason for these is to be able to verify the foundation type of the property. It also verifies if there is a garage attached or not attached to the structure.

So why would an elevation certificate be needed? Well let's say that a property is entered is an above grade crawlspace an elevation certificate can verify this with the building diagram number to make sure it is correct. The elevation certificate will also show if things like servicing equipment are above or below the base flood elevation. This helps to give a more accurate rate for the risk.

Non-Renewal Notice

So if you have received a non-renewal notice from the NFIP what can you do? Well if you have received a letter about this it should state the reason why and the documentation that is needed in order for coverage to continue. If you can not obtain these things within that timeframe then you may want to look at other options like private flood insurance. Generally private flood insurance does not require photos or an elevation certificate because they have different underwriting guidelines.

 

So if you have questions about a non renewal notice you have received you can always visit our website Flood Insurance Guru to learn more. You can also visit our YouTube Channel or Facebook page The Flood Insurance Guru where we do daily flood education videos. You can also join our open Facebook group Flood Education and Flood Insurance Awareness. You can also contact us by clicking the link below.

 

 

Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

New flood maps are going into place for Galveston County Texas on August 2019. Its going to have a bigger impact in certain areas like League City. We want to discuss specifically how this city in the county will be impacted.

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The last time flood maps where updated was 1999 as you can imagine alot can change in 20 years. Texas has seen some devastating  flooding from hurricanes Ike and Harvey during that time frame. We have also seen major land development in this area in the last 20 years which can have a major impact on flood zones. 

What Will Impact be in League City

According to Community Impact Newspaper when maps were originally put in place in 1999 there were only 1,265 home in the 100 year flood zone. We all knew this number would increase with population increase combined with land development. However most people had no idea that number would increase to 3.730 homes in the 100 year flood zone.  This could have a major impact on property values in the area and  the ability for people to afford a mortgage.

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            Property Values

Property values could easily drop when these new flood maps go into place. One reason is that someone is not going to want to pay an additional $200 a month for house that is in a high risk flood zone when they could get more house for their money on a home that is not in the high risk flood zone. While homes that are being moved from a low risk flood zone, which is a flood zone X to a flood zone A or AE may not see a huge impact the first year, they could the second year.

Coastal landscape Beach view of boardwalk and deck by dune near peaked roofs of houses in Cape Cod, Massachusetts

Impact on Mortgage

Like many other coastal areas have shown us when an area is moved into a high risk flood zone it can have big impact on mortgages and the ability for someone to get a mortgage. What would you do if your mortgage increased by $200 a month tomorrow.

  Well you would probably panic a little bit as maybe you should. This could possibly force you into a bankruptcy situation, so what if you want to but the home?

When purchasing a home mortgage companies use something called debt to income to determine how much house you could afford. Well flood insurance premiums just like home insurance premiums are part of this equation. So $200 a month could easily stop you from getting the home of your dreams or even your starter home. So what other options are available?

 

Technology online banking money transfer, e-commerce concept. Happy young man using smartphone with dollar bills flying away from screen isolated on gray wall office background.

What are the Options

There are really three different options on the table when this happens in a community. You can do a policy through the National Flood Insurance Program, the private flood insurance market, or fight it.

National Flood Insurance Program

So when a League City or Galveston property is placed in a high risk flood zone the first thing people think about is the NFIP or FEMA. If you are going from a low risk zone to a high risk zone in Galveston then you have newly mapped flood insurance rates available. This is very important because it is very common for people in Galveston to be overcharged hundreds of dollars because a policy is not written correctly. When you qualify for new mapped rates you are basically getting the preferred rate for the first year. Each year after this your rate will continue to increase until the premium matches the flood risk correctly. That could mean a rate increasing 125% over a 5 year period since this is the current max renewal increase FEMA can do. So then what is the other option for flood insurance in League City and Galveston Texas? Well that would be private flood insurance.

 

Private Flood Insurance

Private flood insurance is just like it sounds. It is flood insurance that is provided by private companies in Galveston Texas. Because of this they can use their own underwriting guidelines and determine flood premiums differently. Private flood insurance can also decline Galveston properties depending on the risk. For example if a property has flooded in the last 5 years or a claim exceeds $50,000 than it is likely the private company would decline it. They could also decline it if it is in a floodway. If you are a good fit for private flood it could save you up to 50% compared to FEMA with more coverages. So we have talked about NFIP and private flood insurance, is there anyway to overturn these new maps?

Can You Fight It

Can you fight these changes? Yes you can now you might not when your case in Galveston like you might in other parts of the country. If any area has had a history of flooding then winning this fight is less likley. Something else that needs to happen is the lowest adjacent grade of your property needs to be above the base flood elevation by usually 1 foot in coastal areas like Galvestorn or League City Texas.

So maybe you have questions about what flood options are available in Galveston or League City Texas? Please visit our website Flood Insurance Guru

You can also check out our YouTube channel or Facebook page The Flood Insurance Guru where we do daily flood education videos. Click the link below to learn more about these options as well.

 

Start My Flood Insurance Quote

 

Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

 

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Flood insurance premiums in Birmingham, Alabama just keep increasing a fast pace but why. Parts of Birmingham like Trussville, Pell City, Leeds, Moody, Pelham, And Alabaster Alabama have not seen more flooding than other parts of the country. If anything flood insurance premiums in Birmingham Alabama should be going down shouldn't they?

Everyone thinks because an area hasn't experienced flooding recently that flood insurance rates should be going down. However you have to remember just because it hasn't happened recently does not mean the risk is not there. Flooding risks are based on probabilities lets discuss the two flood zones that use these probabilities.

 

           Flood Zone A

Flood zone A are areas subject to inundation by the 1-percent-annual-chance flood event. Because detailed hydraulic analyses have not been performed, no Base Flood Elevations (BFEs) or flood depths are shown. Because of this many times flood zone A premiums can be very high.

 

          Flood Zone AE 

Flood zone AE areas subject to inundation by the 1-percent-annual-chance flood event. The big difference between these zones and A zones is the base flood elevation numbers are known.

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Why the high rates

Many of these high rates should really not be high for a few reasons. First of all many of these properties are in high risk flood zones when they should not be. Alot of these properties could be corrected with a simple survey or elevation certificate that shows how the elevations of the home compare to the base flood elevation. Just be careful before paying for an elevation certificate because in flood zone A it could be a waste of money if there is no flood elevation.

    Subsidized rates

Some of these rates are also high because FEMA subsidized flood insurance rates many years ago. They do this to make flood insurance affordable in many areas. Some of these subsidizations go away over time drastically increasing flood insurance rates.

So what can be done

Well as these subsidizations go away there is still hope with the Community Rating System these are discounts FEMA allows when communities do certain mitigation efforts to protect the community against flood hazards.

         Private flood insurance

Private flood insurance is another option that is helping alot of property owners in Birmingham Alabama. These are flood policies that are backed by private insurance companies. As a result they can pick what risks they want to insure while FEMA generally can not. So as result many times they can provide options with better coverage and rates that might be 40% less.

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Maybe your flood insurance rates just keep drastically increasing and you want to see what options are available? Visit our website Flood Insurance Guru, our YouTube channel or Facebook page The Flood Insurance Guru where we do daily flood education videos.

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Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com