A lot of things will be changing once the new national flood insurance program kicks in next month. This will impact mostly rating as the new Risk Rating 2.0 from the Federal Emergency Management Agency (FEMA) and the National Flood Insurance Program (NFIP) aims to provide a more accurate representation of flood risks when it comes to flood insurance premiums.

Today, we want to talk about the impacts of this new program and will it stop property owners from buying a  flood insurance policy for their homes even in the low-risk zones?

NFIP Risk Rating 2.0

The new program from FEMA and the National Flood Insurance Program (NFIP) is long-awaited and long overdue. It's been 30 years since FEMA last made an update this big. Let's do a quick recap of what's changing with federal flood insurance in order to better discuss how this will impact the participating communities across the United States.

The Risk Rating 2.0 will mostly impact the rating structure within the National Flood Insurance Program (NFIP). This is because flood zones will move into a regulatory force that comes into play with flood insurance instead of directly impacting the rates.

Here are the old and new things coming into the picture when it comes to how you're rated. All in all, this will be called the flood risk score.

The remaining features are as follows:

• Zone designation in the flood maps (e.g. special flood hazard areas (SFHA) or preferred flood zones) however flood insurance rate maps will only be used from a regulatory standpoint, not rating.
• Distance to a body of water such as a river, lake, or even the coastline
• Prior flood insurance claims or flood claims made with the property
• Policy assumption and grandfather rule

The new things that will come with the Risk Rating 2.0 are as follows:

• Types of flooding that your property experience. This can be either pluvial or the accumulated water due to rain, runoff of collected water that flows from higher areas; coastal which are storm surge or coastal erosion; fluvial or river floods, or sometimes a combination of these.
• First-floor height and elevation of the structure. A new feature that determines your flood risk score is the distance between the ground (grade) from your first floor or the first habitable floor of your property.
• Flood risk mitigation measures made on the property. Is the lowest floor above the base flood elevation? Are there enough flood openings to let floodwaters through?

It's important to emphasize that the Risk Rating 2.0 will show different rates per household, and this new program is expected to cause an increase for most policyholders since we'll be able to see the risk of flooding on our property.

Impacts on Low-Risk Zones

When it comes to flood insurance, it's no secret that when you fall into a high-risk flood zone or high-risk area, your rates can really blow of the roof regardless if you're getting it from FEMA or the private insurers. However, once the Risk Rating 2.0 starts, a lot of properties in low-risk areas will also see a higher amount when it comes to their overall premium.

Since the risk of flood damage is very detailed, we can also expect these low-risk areas to get higher rates to match the flood coverage they will get from Federal Emergency Management Agency (FEMA) and the National Flood Insurance Program (NFIP).

The rates for these flood policies in low-risk zones will also be relatively more expensive compared to the previous program although it would retain the same building coverage and contents coverage. This also directly increases the annual premium from FEMA.

This type of change in the industry is sure to scare a lot of new property owners and new flood insurance policyholders. A good portion of the population might even avoid getting flood insurance at the expense of their security against flood water just because it's a huge burden for their wallets.

The Big Problem

It's normal to see that people will start shying away from buying flood insurance since the rates and premiums from FEMA and the NFIP will get an increase. However, the big problem here is that a lot of people from property owners, agents, and mortgage lenders don't really look at their options.

The truth is that floods don't really stop at a flood zone, so even in low-risk areas, you can still get the same flood damage or chance of flooding with high-risk zones. This is especially true in seasons like we have now where a lot of hurricanes happen. Last year, the Federal Emergency Management Agency (FEMA) found out that at least 25% of the flood insurance claims come from properties that are in low-risk flood zones.

You really don't need to be anxious about flood insurance rates and second-guess whether or not you should buy one. You should since we're talking about protection from flooding for your home and everything inside of it.

If you're one of the people who are thinking of not getting a policy due to the higher cost of flood insurance, you should know that there's always an option outside of federal flood insurance. You see, a lot of homeowners don't really know that there are dozens of private insurance companies which offer the same protection, coverage, or most times, even more, when it comes to flood insurance.

Going Private

We've talked a lot about the comparison between federal flood insurance and private flood insurance. We've created a lot of content solely focused on how these fair up in the flood insurance market from claims, coverage, pros, and cons. For this one, we want to focus on why it's best to have a second option through a private company when it comes to flood insurance.

Since flood insurance is a separate policy from your standard homeowner's insurance policy, most of the time, and depending on your loan type, your mortgage lender will allow you to choose where to get flood insurance. This can really be a big deal especially for those in high-risk flood areas like flood zone A where flood insurance will be required with the property.

READ: The Rematch: NFIP 2.0 vs Private Flood

Private flood insurance can also have your back when it comes to building coverage and contents coverage. Most of the private flood insurance companies would also offer additional coverages like replacement costs, additional living expenses, or loss of use.

The great thing about private flood is that it costs significantly cheaper with more flexible coverage compared to federal flood insurance. This is that "get more, pay less" aspect that really helps a lot of homeowners get protected even when they're in a flood-prone area.

Simply put, there are no coverage limits with private flood hence you can get more than $250,000 for your house and more than $100,000 in flood insurance coverage for your personal property or contents within that building.

Other than the flood insurance cost, you also have a better and shorter waiting period. The NFIP can have your policy take effect on your house after the 30-day waiting period from the date of the flood insurance purchase whereas private carriers can get your policy to take effect on the insured building within 5 to 14 days maximum.

The Real Threat

We understand that seeing standard flood insurance policy rates go high can really scare anyone. We're currently going through a pandemic still and a lot of expenses are needed. However, it's important to keep in mind that the real threat doesn't fall within the policy jacket or its costs. The real threat is when that water starts inundating your house.

It's always best to make sure that you're protected through flood insurance.

If you have any questions on how to buy flood insurance from the private market, the NFIP Risk Rating 2.0 impacts, or anything about flood insurance, click below to reach us.

Remember, we have an educational background in flood mitigation which lets us help you understand flood risks, your flood insurance, your options, and mitigating your property long-term.

We're less than a month away from the first phase of the flood insurance changes coming to the Federal Emergency Management Agency (FEMA) and the National Flood Insurance Program (NFIP) through the new Risk Rating 2.0 program.

October 1st marks the first massive change coming to federal flood insurance for homeowners across the United States in thirty years, and this also means that a lot of people will be affected outside of the flood industry.

Will the NFIP Risk Rating 2.0 program kill the real estate industry?

Understanding NFIP 2.0

The new program from the National Flood Insurance Program (NFIP) is sure to change the flow in the flood insurance industry overall as this will have a lot of changes that focus on individual flood risks. We've talked about this in our NFIP 2.0 Series per State and Counties, but we'd like to review it to further contextualize its impact on real estate.

The biggest change coming to federal flood insurance is the scoring that comes into the flood risks per property. Simply put this "flood risk score" will take into multiple variables that accurately represent the flood risk of a property — regardless of it being residential or commercial property. This score will be based on some features that are staying and new features.

The remaining features are as follows:

• Zone designation in the flood maps (e.g. special flood hazard areas (SFHA) or preferred flood zones) however flood insurance rate maps will only be used from a regulatory standpoint, not rating.
• Distance to a body of water such as a river, lake, or even the coastline
• Prior flood insurance claims or flood claims made with the property
• Policy assumption and grandfather rule

The new things that will come with the Risk Rating 2.0 are as follows:

• Types of flooding that your property experience. This can be either pluvial or the accumulated water due to rain, runoff; fluvial or river floods; or coastal which are due to storm surge or coastal erosion. Sometimes even a combination of these three.
• First-floor height and elevation of the structure. A new feature that determines your flood risk score is the distance between the ground (grade) from your first floor or the first habitable floor of your property.
• Flood Risk Mitigation Measures made on the property. Is the lowest floor above the base flood elevation? Are there enough flood openings to let floodwaters through?

So how will this impact the real estate industry and will Risk Rating 2.0 be able to completely kill off sales for real estate agents?

The Real Estate Impacts

As you would notice, we immediately mentioned that flood insurance will no longer be rated based on the flood zone. Simply put, this will only determine whether or not a property will be required to process a mandatory flood insurance purchase based on its flood zone.

For everyone's information, if you're in a high-risk area like flood zone A, flood zone AE, or flood zone V, your mortgage will be sure to require you to get flood insurance.

This is due to the regulation set by FEMA and the NFIP for every property. Mortgage-wise this is to best protect their assets which is the structure of the building itself and ensure that reselling it will be a smooth breeze.

Flood Zone for All

At the current program, flood zones directly impact your flood insurance premiums as well. People who are in the high-risk flood zones get significantly higher rates than low-risk zones (like Flood Zone X). This also means that if you're paying for $1000 flood insurance, that's an additional $30,000 on a 30-year mortgage.

Most of the time, you can hear from agents or mortgage lenders that you're not in a flood zone when you're just in a low-risk flood zone. They really don't mention this until an escrow because low-risk zones aren't required to get flood insurance. High-risk areas, on the other hand, will immediately get notified about their mandatory flood insurance requirement by the mortgage company.

It's factual that both of these properties can get flooded equally given the right circumstances like Hurricane Katrina and Hurricane Ida recently.

With the Risk Rating 2.0, this "not in a flood zone" misconception in flood insurance from property owners, agents, and lenders alike will be eliminated since each property will have its individual risk of flooding. Basically, all properties will experience flood one way or the other regardless of the flood zone.

This type of change is the first blow to the real estate market since it might discourage a lot of property owners to buy a property. It comes down to the question "will I be able to resell my house?" when all properties have flood risks.

Mortgage and Flood Insurance Policies

When it comes to sales of properties, one of the biggest concerns for buyers is affordability especially when you put in that mortgage, homeowner's insurance, and flood insurance. With the Risk Rating 2.0, the goal is to make more people be aware of their actual risk and convince them to secure flood policies for their homes.

When you take a mortgage out on a home, you'll have a secret escrow in form of these insurance policies. This means that moving into a new property will also get you a possibly more expensive loan and payment each month since you will get a more accurate representation of the flood coverage due to your risks.

It's important to remember that when you have a flood insurance policy in place, it will be a separate payment from the homeowner's insurance or the mortgage loan per month. The thing is, you can't really escape floods as we've seen with Hurricane Ida in New York, so getting flood insurance is a must to protect your personal property or contents as well as your entire home.

This might cause an effect where people will rather do measures to better protect their own house instead of buying a new one. The chance of people having cheaper homes to get more security when it comes to floods might also go up.

Best Steps Forward

The real estate won't absolutely be killed off by the new Risk Rating 2.0 program since a lot of people will still buy or sell houses. However, it's more likely that the industry will either have to strategize with this new program or get massively hurt by it.

At the end of the day, this new program isn't just for the sake of creating more problems other than the threat of being in a flood plain or waters rushing to inundate your property. This is equity in action for a reason since flood insurance is somewhat getting ignored to the point that it becomes detrimental to one's investments and homes.

We've seen how Hurricane Ida showed that flood zones aren't really the safeguard from flooding since water will never know where and when to stop. New York saw a lot of homeowners clueless on the steps forward to recover from the damages.

The best thing to do is to really think hard about selling or buying a house since it will also include flood insurance one way or the other. Regardless of flood zones, every home will get to see their flood risks and the scores won't be zero.

If you have questions on how to best approach real estate with the Risk Rating 2.0, how to get flood insurance, and how to see your flood risk scores even before the new program kicks in, click below to reach us.

Remember, we have an educational background in flood mitigation which lets us help you understand your flood insurance, your flood insurance, and mitigating your property long-term.

When it comes to insurance policies, these things involve a lot of commitment and hard-earned cash from everyone, so people are starting to become more careful with it.

Today, we want to talk about the three reasons why people across the United States don't buy flood insurance and understand why you should avoid this type of thinking.

Not in a Flood Zone

The first reason we always hear that comes from not just property owners, but also mortgage lenders and insurance agents. This is a common misconception in the flood insurance industry which we've covered in our previous blog.

When a mortgage company tells you that you're not in a flood zone, this doesn't really mean that you won't get flooded instead it simply means that your property is no longer in a high-risk flood area or high-risk flood zone like a flood zone A.

A lot of people think that they're not in a flood zone, so they don't need flood insurance however this isn't really the case. When your mortgage company or insurance agent tells you that you're not in a flood zone hence you don't need flood insurance, this doesn't mean that you're not going to be flooded.

It's important to note that when you're not required to carry flood insurance is due to the fact that maybe your house sits on or was moved into a low-risk area. Now, when it comes to the time that a flood event happens, these low-risk flood zones have less likelihood to get properties inundated with water.

We've seen this happen with New York where a lot of people couldn't find coverage for the flood damage that was brought by Hurricane Ida. The thinking that only high-risk areas need to have flood insurance is a big hoax in the industry since there's individual flood risk for each property.

This is why a flood map or flood insurance rate map would show you in a flood zone regardless. This requirements of when to get flood insurance based purely on flood zones are creating a bigger disaster than the water itself.

This isn't an exception from the damages, however. This brings us to the second reason.

Flood Risks

A lot of low-risk areas get inundated with water even after a storm or heavy rainfalls in other zones because there's a chance that the excess flood water will flow into these low-lying communities. You also have to consider that certain development disrupts the natural pathways of water and causes only 10% of the water to go into the ground.

This second reason will be coming from people who know that they're in a low-risk flood zone, but underestimates the damages that flooding can bring to their doors. It's important to note that these flood zones determine how much flood that your property might get. This doesn't indicate how severe the impact may be as flood damage varies depending on the circumstances.

A rapid flash flood can cause more damages than standing water that's inundated your home. This also means that it's very much possible to have the same flood impact regardless if you're in low-risk or high-risk areas.

According to Wharton School as cited by Zurich, in New York, eighty percent (80%) of residential property didn't have flood insurance and ninety percent (90%)  of business or commercial property also didn't have any sort of protection from the flooding during Hurricane Sandy. This shows how much property and business owners disregard the opportunity to get protected through a flood insurance policy.

Homeowner's Insurance Policy

Lastly, we have another common misconception when it comes to insurance, flood coverage, and more. When it comes to this part, it's important to understand that your homeowner's policy doesn't really cover any damages from flooding. A lot of people think that flood coverage can be attached to your homeowner's insurance once you secure a policy for the structures in your home.

Flood insurance is a separate entity when it comes to insurance coverage. Yes, this will still get you coverages for the damages on the insured building that's been inundated with water. So let's take a few steps back and understand what's covered by your homeowner's insurance and your flood policy.

Now, when it comes to damages any type of water damage that impacts your home will be covered in the policy jacket of your homeowner's policy. This is because when it comes to floods, there's what we call the "Number Two Rule" set by the federal government through the Federal Emergency Management Agency (FEMA) and the National Flood Insurance Program (NFIP).

This rule determines if you need to file a claim to your homeowner's insurance company or through flood insurance, be it FEMA or the private flood insurance market. According to the rule, it will only be considered as flood damage and will be covered by your flood policy if it qualifies for either one of the two conditions. A flood will only be considered as a flood if:

1. At least two (2) acres have been inundated with water - This means that if standing water starts to impact a community, it will only be considered as a flood if there are at least two acres of land are impacted and, basically, is underwater due to excess water from rain, storm, runoff, melting ice/snow, or any type of natural disaster.

2. At least two (2) properties have been inundated with water - This means that any type of two properties; house, business, or park, for example, have to be inundated or impacted by floodwater that comes due to the aforementioned reasons. In order to qualify for a flood insurance claim, one of these two properties must be your insurance building.

This can be a very frustrating experience if you don't know when you can file a flood claim for the damages. There's also a chance that you were flooded and reach out to your homeowner's insurance provider only to be rejected and left with nothing.

At the end of the day, it's always best to find security through a flood policy. This is the only way back up when all that water starts to destroy your home, the buildings you have and all their contents, and important personal property.

If you have any questions about flood risks, how to get flood insurance through FEMA, NFIP, or the private market, or anything about floods, reach out to us by clicking below.

Remember, we have an educational background in flood mitigation which lets us help you understand flood risks, your flood insurance, and mitigating your property long-term.

Today, we want to talk about the mortgage requirements when it comes to flood insurance, especially during flood disasters. Now, it's important to preface this that we aren't pointing out a certain mortgage lender but more on the general requirements, conditions, and things like that.

We want to close this case by asking "are these mortgage requirements creating more disasters than the flood itself?

Property Coverage

There are countless times during this type of disaster, there are property owners who would say that they got everything covered for their property and buildings for business owners. In these cases, a lot of people would also refrain from buying flood insurance because the mortgage doesn't require it since they're not in the flood zone.

When flooding strikes or any other natural disasters, these buildings will become a liability for these homeowners because the flood damage isn't covered by their homeowner's policy. For the nth time around, we want to emphasize that flood insurance is a separate policy, and flood damage is only covered by flood insurance policies.

This type of flood insurance requirement has been in the industry since day one, and what we want to find out is if this type of standard is causing a bigger disaster; "standard" being that any property in high-risk areas when it comes to flood insurance rate maps (FIRM) are required to buy a flood policy whereas those in low-risk zones aren't really required to buy one.

Hurricane Ida

Now, this issue is the same thing that we're seeing happen in New York as a state where a lot of property owners are leaning on their mortgage company to decide whether they need flood insurance or not, but as we've seen, what happened in New York is not a flood zone problem.

READ MORE: New York Flooding: Not a Flood Zone Problem, A Flood Risk Problem

There are also cases where the flood insurance coverage follows the loan limits which is a much worse case since you do get covered for the damages, but that won't really bring you back to speed with things, and most of the time, this can still cause a substantial financial burden for you. All those repairs to fully cover your property — both building and personal property — are at your financial expense.

So how can you prevent this type of issue become an experience when flooding happens in your area?

80% Rule

First, we want to address the 80% rule when it comes to the National Flood Insurance Program (NFIP) under the government and the Federal Emergency Management Agency (FEMA) and even in the private flood market. 

What this rule entails, especially with the National Flood Insurance Program (NFIP), is that you should either have an 80% replacement cost for your property, $250,000, or whichever one is higher. This can also have the property default to actual cash value (ACV) which means you can only get $50,000 for a $250,000 property. We see this every day when it comes to flood insurance policies with the NFIP.

The same goes for private insurance carriers where you either go for 80% of the property cost or it drops down to ACV. This is indeed creating a bigger disaster when it comes to flooding since you only rely on flood zones to get a standard flood insurance policy to cover your home. 

If you have any questions on how to make sure that you have enough coverage, where to get flood insurance, or anything about floods, click below to reach us.

Remember, we have an educational background in flood mitigation which lets us help you understand flood risks, your flood insurance, and mitigating your property long-term.

Another hurricane had made its landfall on the southeastern parts of the United States however this time around, Texas and Louisiana might be the first to experience the impacts of Hurricane Nicholas as we move through the week.

Join us as we unpack how Hurricane Nicholas will impact the southeastern United States and what this could mean considering that these coastal zones, especially Louisiana are still recovering from Hurricane Ida last week.

Enter Hurricane Nicholas

Hurricane Nicholas started out as a typical hurricane however the good news is that it downgraded to a less dangerous tropical storm as it made landfall earlier today, September 14th, 2021. The tropical storm made landfall on coastal Texas with 70 MPH winds according to the National Weather Service (NWS). Tropical storm warnings are everywhere in both Texas and Louisiana.

At the time of writing, northwest Harris County (Texas) is receiving about 1 to 3 inches of rain since the tropical storm made landfall.

However, this doesn't really eliminate the threats when we start to talk about an estimate of 20 inches of rain getting dumped on coastal Texas and the state of Louisiana. It's important to highlight that these two states were in the hot seat of flooding earlier this year.

We need not look further than a few weeks ago when Hurricane Ida made landfall on New Orleans causing massive power outages, devastating casualties, and millions of damages from Louisiana, New York, Tenessee, and towards the eastern coast.

READ MORE:
Hurricane Ida Impacts in Louisiana, Hurricane Ida Floods New York

Despite this downgrade, we're still talking about the extremely high risks of flood especially in Louisiana and Texas since a lot of factors are just waiting to cause flooding in these areas without any warning once that heavy rains and continuous rainfall start.

What To Expect

When it comes to this type of situation, the biggest threat that Louisiana and Texas will face will be that flash flood. The Southeastern parts of the country are still recovering from all that rainfall and flooding from Hurricane Ida.

This simply means that the ground is still oversaturated with all that water that Tropical Storm Nicholas' heavy rains will be like water hitting hard cement. A lot of overflows might happen with these circumstances given.

You also have a storm surge warning in place in Port Aransas to San Luis Pass including Aransas Bay, San Antonio Bay, and Matagorda Bay. Once that water comes in from the coasts, not only the properties in flood zone V will be impacted.

Flash flooding will also be a big problem as the tropical storm adds up to the hurricane season causing more saturation from the ground. Inland bodies of water might also rise significantly.

It's important to highlight that even when that heavy rainfall stops, rivers, lakes, streams, and creeks will continuously collect all that water and rise in a span of a couple of days. This effect is sure to create life-threatening flash floods along the coasts even without massive storm surges coming in.

How To Best Prepare

We've covered a lot about how important it is to have flood insurance. This is basically the heart and soul of our company since this is the only best protection one can get when a flood threat is present in your area.

The thing is a lot of property owners still think that not sitting in a flood zone means that they won't get flooded. Water doesn't know where one flood zone ends and another starts which we've seen happen in the entire state of New York.

READ MORE:
Texas Spring Flooding, Baton Rouge Spring Flooding

You can always secure flood insurance through the government which has fewer restrictions and caters to all types of property through the Federal Emergency Management Agency (FEMA) and the National Flood Insurance Program (NFIP) with a $250,000 coverage for residential properties and $100,000 when it comes to personal properties.

It's important to note that when it comes to the NFIP, those coverages max at the aforementioned amount regardless of your flood zone. This is very different when it comes to private flood insurance carriers which do not have any coverage limits, so you can tailor-fit your coverage depending on your discretion.

Lastly, we want everyone to be safe in this type of weather since no one can really predict when a disaster might happen. If there is a risk of flash flooding detailed by flash flood warning issued by the NWS, we encourage that you follow these to avoid any injury or casualty.

If you want to know more about flood insurance, how to buy flood insurance through FEMA or the private market, or anything about flooding, reach out to us by clicking below.

Remember, we have an educational background in flood mitigation which lets us help you understand flood risks, hurricane and tropical storm warnings, your flood insurance, and mitigating your property long-term.

Flood insurance is slowly but surely transforming itself as we veer closer to the new Risk Rating 2.0 program with the National Flood Insurance Program (NFIP) and the Federal Emergency Management Agency (FEMA).

If you've been with us, you know that we're talking a lot about flood maps or flood insurance rate maps (FIRM), flood zones, flood claims, and flood insurance premiums. Today, we want to discuss a very crucial aspect of flood insurance that may not seem impactful, but can either make or break you. We want to answer, what role does time play when it comes to flood insurance?

Wait Period

FEMA and NFIP

There's a lot of things that come into play when it comes to flood insurance. One of the most important things to know is the waiting period. Depending on where you're getting flood insurance, this can really have a huge difference especially if you're concerned about when your policy is going to take effect.

If you were to get a flood policy from the National Flood Insurance Program (NFIP) as preparation for protecting your property as a homeowner when it comes to natural disasters that cause flooding — like what's happening right now with Hurricane Ida — you will have to really strategize on when you should buy flood insurance.

We strongly encourage that if you're buying from the National Flood Insurance Program (NFIP), do it as soon as you can since they have a 30-day waiting period for all policies to take effect. This will stay the same even with the Risk Rating 2.0 update for the NFIP. If you were to buy a policy on September 1st, all the building coverage and content coverage won't kick in until October 1st.

We've said this many times; don't wait for the water to come rushing to your door because you're not in a flood zone. It's important to have a look back on events just this year with Baton Rouge in Louisiana, Monnett in Missouri, Nashville in Tennesse, and more recently with multiple counties in Virginia. These were times where heavy rain caused a lot of problems for residents due to flooding.

If you want to best prepare for your flood insurance policy with the NFIP, you'd want to do it as soon as now because there's no telling when floodwater can come to your own porch.

Private Flood Insurance

When it comes to private flood insurance, there will be significantly shorter waiting periods for your policy to start to kick in. Most private flood insurer can get you a policy as soon as all the purchase process itself has been completed and will only take 7 - 10 days for the policy and its flood coverage itself to kick in. This is because any private insurance company you pick is no longer under the federal government, so you won't really have to go through all those red tapes.

We recently helped a customer get their policy renewed with a private insurance company with only a 7-day wait period without any lapse on their coverage. Simply put, they are able at all times with this renewal of the policy.

As you can see, this shorter waiting period can give anyone peace of mind when it comes to preparing for flood damage. This immediate turnaround time also helps any property owner across the country understand their risk of flooding ahead of time.

Understanding your flood risk is a key step in preparing for dangerous flash floods, be it through a flood map or your flood risk score.

Claims

FEMA and NFIP

Another thing that you want to look into how time plays with flood insurance is the flood loss claims themselves. When it comes to the federal program, there will be a 20-year look back on the flood insurance claim on the property. This 20-year look back can change how the rates for flood insurance will go. This is what's called a flood claim variable. We've already covered the nooks and crannies of this through our previous blog.

There's also the 10-year rolling period for flood claims which determines whether or not your property will be included in the severe repetitive lost property list. Generally, this happens once you file more than one claim in a 10-year rolling period with FEMA.

Private Flood Insurance

When it comes to private flood insurance, time is still a big player since it's most likely that an insurance carrier will refuse to give you a flood insurance policy because you had a claim from 5 years ago. This is one of the things you should look out for when it comes to private flood insurance. These carriers can pick and choose who to provide insurance to, when to provide it, and when they will pull back. 

Time and Time Again

These are just some roles that time plays when it comes to flood insurance. However, one of the most important things that time plays into when it comes to flood insurance or flooding, in general, is when you hear people say: I wish I had more time preparing for this, or I wish I knew that homeowners insurance policies don't cover flood damage at an earlier time in my life.

Let's all keep in mind that water doesn't know time. One moment it's just rain then a few seconds you're already knee-deep in floodwater and your property's already wrecked by water. So if you have questions on flood insurance timelines, when and how to buy flood insurance, or what your flood risk score is, click below to reach us.

Remember, we have an educational background in flood mitigation which lets us help you understand your flood risks, flood insurance, and mitigating your property for a much longer time.

It's been cold then hot and going back in forth with the bad weather day moments we have in the country. Most parts of the country are still recovering from Hurricane Ida and major areas were devastated by strong winds and widespread flooding.

Today, we want to talk about the recent wildfire event in California that the National Incident Management and Cal Fire are still trying to resolve, how this will impact future floods in the impacted areas and counties, and what these wildfires can mean for floods. We will also discuss how this will impact Lake Tahoe despite being spared from the Caldor Fire.

Flames after the Storm

As we were moving past Hurricane Ida, extreme weather patterns show its impacts as California was hit by a massive wildfire event in the middle of August as yet to be determined cause started the fast-moving Caldor Fire at South Lake Tahoe and spread towards El Dorado and Amador Counties. This prompted President Joe Biden to declare a state of emergency for California 

About 220,000 acres of land were engulfed by the Caldor Fire prompting mandatory evacuation measures. At the time of writing, good news came to residents as the evacuation orders were lifted for the entire west area of the Caldor Fire such as Sly Park, Pollock Pines, and Grizzly Flat. The east zone of the state is expecting to get minimal to moderate fire behavior.

However, it's important to note that the fire is still active for 24 days now with only 50% estimated containment. More than 50,000 people remain evacuated due throughout the region, including into Nevada and at least 664 structures have been destroyed including at least 482 single homes, 11 commercial properties, and 171 other minor structures. The damage assessments continue at the time of writing, so we really don't have an accurate damage report yet.

As the Caldor Fire slows, three new wildfires erupt causing red flag warnings for portions of central Oregon and central northern California. We also have to take into writing that the Dixie Fire scorched more than 900,000 acres across five counties in Northern California since its genesis on July 14.

We hope that everyone will be safe especially in the areas like Amador County, Douglas County, and Placer County in Nevada. If you receive any evacuation warnings, don't hesitate to go to an evacuation center. Please be safe and take care.

The Irony of the Spared Lake Tahoe

Lake Tahoe was spared from the Caldor Fire however this actually presents an ironic situation when it comes to natural disasters. We've previously talked about the impacts of wildfires, such as the Gatlinburg Fire (Tennessee) in 2016, and other disasters when it comes to natural disasters, and the Caldor Fire won't be different.

Now that a lot of that forest became ashes and the ground that once held it is now scorched, it's very likely that when rain gets dump in the area during cooler weather, it will cause a lot of flooding for California. Forests are one of the best natural protections we have against flood water and since they're no longer in the equation, there's nothing getting between that water and your property. The Caldor Fire was huge enough that it started the haze obscured both the Golden Gate Bridge and the San Francisco skyline on August 18.

Areas like El Dorado County, Alpine County, Amador County, and Douglas County are also prone to flash flooding, mudflows, landslides, and mudslides once a sufficient amount of rain gets dumped on this area.

The biggest issue with scorched land like this is that the ground itself might not be able to sustain any form of vegetation to contain water from rain, if not floods. The ground impacted by both the Caldor Fire and Dixie Fire might not see any green leaves anytime soon. Once that rain hits, it's like water hitting cement. It will go nowhere, but down.

The lifting of evacuation orders doesn't really address the flood that may come after and even Lake Tahoe was spared from the Caldor Fire, once the lake starts to rise it's most likely that the first area we'll see a lot of water is on the South Lake Tahoe and other low-lying areas impacted by the fire.

The thing is only floods and mudflows will be covered by your flood insurance policy. The fire itself, mudslides, and/or landslides will be covered by another policy. We encourage everyone to put safety and your insurance as the biggest priority during these times. We've seen how unpredictably dangerous weather conditions are this year alone.

Safety First

There's no telling what can happen next and it may sound contradicting, but floods might come any time soon for these impacted areas and nearby communities to the Caldor Fire. As containment efforts continue in the region, we want should be sure to make sure we have enough coverage from our insurance policies when disaster strikes.

If you have questions on flood insurance, how are wildfires cover by your flood insurance policy, or anything about flood, reach out to us by clicking below:

Remember, we have an educational background in flood mitigation which lets us help you understand flood risks like the ones that wildfires present, your flood insurance policy, and mitigating your property long-term.

Be safe, be alert, and eureka, California.

 

A lot of things happened after Hurricane Ida came to the country with its category-4 landfall and multiple states flooded due to continuous heavy rainfall. A lot of businesses were shut down with the impacts of the hurricane, personal property washed away, and homeowners are at a loss.

Today, we want to cover how disaster assistance, disaster loans work, and how they would impact your flood insurance. Can you get both flood insurance, disaster assistance, or disaster loans?

Disaster Assistance

When it comes to the application process with the disaster assistance there are two things that must happen first: a presidential declaration for the natural disasters that recently happened, and you must meet certain standards and restrictions to be one of the eligible individuals for this federal government assistance.

Considering what happened with Hurricane Ida and the consistent flood risk in New York even though the hurricane had already passed, it's a good thing that President Joe Biden gave the government a green light for disaster assistance during these trying times, this means that all individuals may be eligible to get one.

However, disaster assistance isn't like flood insurance where you can get one that easily. This has to go through a tedious process for you to get that financial assistance from the government. The Federal Emergency Management Agency (FEMA) will first contact you via U.S. mail or email for the next steps.

They will also send out an inspector to survey your home to see if it's livable. Before, this means that they will get inside and on every nook and cranny of your property, but considering the coronavirus pandemic, they will survey it only from the outside.

If they were unable to contact you or saw your property is still livable, then your disaster assistance might get denied. Now, it's important to note that if your insurance already covers all the damages that your property incurred during the New York flooding, your disaster assistance will also get denied. It's also important to mention here that if more than one person applied for disaster assistance, one of these two people will get denied.

Disaster Loans

Now when it comes to disaster loans through the U.S. Small Business Administration loan, this would come into play if you need more financial assistance of $200,000. Most of the time, we see business owners utilize this option to have their business bounce back from any flood damage and we might see it in New York as well.

What's important to note here is that these are low-interest, low-term loans that aren't covered by your insurance by they can get any amount written in your disaster assistance and flood insurance. Generally, this means that you can get all three at once however it's most likely that your SBA loan will collect your insurance coverage, disaster assistance, and put it into one disaster loan. This disaster loan can cover uninsured buildings, contents, or sometimes even vehicles. 

Flood Insurance

Now, we've talked a lot about flood insurance whether it's from FEMA or the private flood insurance market, and the thing is you really won't need to apply for disaster assistance and disaster loans if you have everything correctly written on your policy.

A standard flood insurance policy will cover any flood-related damage for any homeowner and/or any business owner. This coverage maxes out at $250,000 in building damage and $100,000 for the contents within the insured building when getting the flood policy from FEMA and the National Flood Insurance Program (NFIP).

Although this recent presidential declaration from Biden would help you also get additional living expenses from FEMA and the NFIP, generally this won't be included in your coverage with federal flood insurance.

Good thing is that the private flood insurance market will be more versatile with its coverage as it doesn't really have any coverage limits. Generally, private flood policies can cover you for more than $250,000 and $100,000 for building and contents coverage respectively. You also get to easily opt-in for additional coverage such as additional living expenses, loss of use, and replacement costs.

It's important to note that even with flood insurance, disaster assistance is still up for grabs however this may impact your flood insurance rates and flood insurance premiums as most of the time, a property that applied for disaster assistance gets moved into a high-risk flood zone.

All of these options will be available for New York especially after what happened with Hurricane Ida however you need to be very mindful of which ones you really need since it can bite you back in the future.

If you have any questions on disaster assistance, disaster loans, how to get flood insurance, and understanding your flood risks, reach out to us below:

Remember, we have an educational background in flood mitigation which lets us help you understand flood risks, your flood insurance, and mitigating your property long-term.

Hurricane Ida is getting closer to about to leave, but it won't leave quietly.

At the time of writing, the remnants of Ida caused New York City to receive their first flood warning. At least 8 people are already confirmed dead due to this terrible weather we're getting from the hurricane and this flood warning is a testament that the impacts of any hurricane can come from many ends, not just rain.

Today, we want to talk about what this could mean for flood insurance, how to best prepare and protect yourself from any flooding damage caused by Hurricane Ida.

The Empire State

The concrete jungle of New York City is currently holding on tight as its streets are starting to get inundated by floodwater. A flood warning was issued by the National Weather Service (NWS) earlier today to give a heads up as there is an expected rainfall amount of at least 3-6 inches of rain.

NBC New York (NBC News) reports that 6 people are already confirmed dead in New York just yesterday and this number is still going up. It's no surprise that the NWS has declared multiple flash flood warnings across New York and New Jersey.

Among the other deaths reported in New York City, a 48-year-old woman and a 66-year-old man died after being found at separate residences, and a 43-year-old woman and a 22-year-old man both died after being found inside a home. This also includes a 19-year-old man who was found dead in Montgomery County. Causes of death and identifications are yet to be announced. 

Police in New York City reported seven deaths, including a 50-year-old man, a 48-year-old woman, and a 2-year-old boy who were found unconscious and unresponsive late Wednesday inside a home according to Providence Journal.

Subway lines also had to shut down due to this weather event and a lot of commuters were stranded for a good while. Twitter is equally flooded with videos of locals showing the heavy flooding inundating cars. Subway Riders also posted videos showing that they had to stand on their seats in cars filled with floodwater.

All throughout this week, we've been covering a lot about the impacts of Hurricane Ida when it made landfall on Louisiana and caused brutal flooding. After that, we also saw areas in Virginia also face the impacts of Ida just a couple of days ago as a small town in Waverly gets washed away by this weather event.

As of now, a flash flood emergency is declared for the Bronx, Kings (Brooklyn), Western Nassau, New York, Queens, Richmond (Staten Island), and Southern Westchester areas in New York as heavy rains are still expected.

New York Flood Insurance

This hurricane hitting the northeast may be impactful when it comes to flood insurance as this proves that given the perfect cocktail of conditions, any place can flood. As we're fast approaching October 1st where the new Risk Rating 2.0 program will start to take place it's important to keep in mind some changes in federal flood insurance that may be impacted by this weather event.

As the National Flood Insurance Program (NFIP) is about to take on a new face when it comes to flood insurance, we should also start seeing the big changes when it comes to understanding flood risks. At our current federal flood insurance program, the Federal Emergency Management Agency (FEMA) doesn't really consider things like climate change and the nature of floods when it comes to their rating system.

Now, we'll start seeing a deeper look into the fingerprint of New York properties' flood risk. Each homeowner will be able to experience the same "equity in action" as FEMA pushes through with this new program. This simply means that property owners are rated based on multiple flood risk variables, which most of the time aren't the same as your neighbors.

It's equally important to be ready once the flood insurance rate map (FIRM) or flood maps start to change to address this type of flooding incident across New York. Although with the Risk Rating 2.0, the flood zone determination is only needed from a regulatory standpoint, it still is crucial to find the time to understand your risk better.

It may not be a tornado, storm, or flood that will surprise you, but your flood premiums blowing of the roof can really catch you off guard when it comes to these changes with the NFIP.

Equally, this also impacts people who are getting flood insurance from private insurance carriers. If you were to file a claim with your private carrier for the flooding you receive, it's not impossible that you might not get flood insurance from them again since you have had a successful claim in the last 5 years.

Hurricane Ida also showed some of the lapses in understanding how floods work. Looking at New York, one can say that it's not really a flood-prone area in recent years however this doesn't ring true now that we've seen how one hurricane can start severe flooding — even torrential rains can be enough to start major flooding in the area.

How To Best Prepare

The first thing that we want to remind people is to not ignore flash flood emergency warnings issued by the National Weather Service (NWS). I was scrolling through a tweet on Twitter when I saw a bunch of replies saying that they don't need to worry about all these floods because they're living on the fourteenth floor and things like that. However, water doesn't know the time and when to stop.

You can use your weather app on the phone to check how it's going with or without a hurricane. This also gives you enough visibility for your entire city. Maybe even Spider-Man and Captain America use these apps to get up-to-date.

A lot of people might say that they didn't have enough time to prepare for the possible catastrophic damage that hurricanes and floods can cause, but I digress. Let's all keep in mind that once that hurricane season starts, once winter ends and spring starts, or once rainfall is expected to drop on your area, floods may — most times will surely — follow. Water doesn't know time and flood zones so be safe out there.

If you have questions on flood insurance, how Hurricane Ida will impact flood insurance, what role does time really plays in flood insurance, or anything about floods, click below to reach us:

Remember, we have an educational background in flood mitigation which lets us help you understand flood risks, your flood insurance, and mitigating your property long-term. You too can be prepared when events like this happen.