We have already dove into the upcoming changes to the flood insurance rate in Alaska statewide in our previous blog. Today, we want to dive deeper into further understanding these changes as we focus on smaller parts of the state, the counties that are most impacted by these upcoming events to the federal flood insurance rates.

Juneau, Alaska: New Federal Flood Insurance Risk Rating 2.0

In this blog, we'll cover the upcoming flood insurance policy changes to Juneau, Alaska, and understand how we can better prepare for flood insurance changes from the federal government.

Risk Rating 2.0

First, let's go through a brief rundown of the changes coming to the National Flood Insurance Program (NFIP) which is provided by the federal government under the Federal Emergency Management Agency (FEMA). These changes are through what's called the Risk Rating 2.0.

This is what FEMA calls equity in action when it comes to making the cost of flood insurance policies fairer per policyholder. Generally, this is because property values for each individual property will be accounted for when finalizing your quote and flood insurance premiums with the National Flood Insurance Program (NFIP).

It's important to note, however, that this won't mean that the cheapest flood insurance will go automatically to lower-valued homes. It's equally important that we take into account, just like FEMA does and the private flood insurance industry, what's called flood risk variables which includes, but is not limited to the following:

  • Designation in the flood zone maps.
  • History of flood incidents, flood damage, and flood loss
  • Flood claims made with the property
  • Flood hazard, the chance of flood, and impact of flooding
  • Risk of flood in the area and chance of flooding
  • Mitigation efforts made on the property. Is the lowest floor above the base flood elevation? Are there enough flood openings to let flood waters through?

NFIP: Federal Answer to a Flood Event

We encourage everyone to get a flood policy for your properties since flood happens everywhere and most of the time without notice. Regardless of your flood zone, flooding happens everywhere.

However, getting flood insurance is simply the first step in making sure that you're protected since it's equally crucial that you are up-to-date. Think of this one as your favorite app on your phone. Sure, you might have installed it years ago, but if it's not updated it's only going to cause problems long-term for the app you have. 

You have private insurance companies building up a community for private flood insurance and also the more widely known federal government and the National Flood Insurance Program (NFIP).

Juneau, Alaska: New Federal Flood Insurance Risk Rating 2.0

These NFIP flood insurance cover both damages to the building and contents. When we say building, this generally pertains to a residential property or a commercial structure that gets flood coverage that maxes out to $250,000 (up to $500,000 for commercial flood policies only). At the same time, you'll also find contents coverage of $100,000 or the personal property you have listed with the insured building.

FEMA and the NFIP also help in other ways as well since policyholders eligible for their Increased Cost of Compliance (ICC) and what's called the Community Rating System (CRS).

The ICC is an additional $30,000 flood coverage to give way for flood mitigation efforts for the insured property to avoid massive losses from a future flood event. The CRS on the other hand is a community-based rating system that measures the overall flood mitigation efforts made by the community in general; basically, this means that the higher your CRS score is, the bigger the discount

Today, we want to focus on the good and the bad changes to Anchorage policyholders with FEMA in this new rating methodology. The Risk Rating 2.0 and its changes will be starting this October 1, 2021.  

Juneau, Alaska: New Federal Flood Insurance Risk Rating 2.0

The Good

We want to cover the good things coming to Anchorage first. We'll divide these good changes into two to specify the changes coming to flood insurance rates. This good change will bring an immediate decrease in the premium rates of those impacted. About 88.7% or 282 of the policies in the city will get impacted by this change.

The first half will impact about 72.3% or 230 policies will be getting a decrease that ranges from $0, which means there'll be no change at all, to $50 per month ($0 - $600 per year). The other half of this good change impacts 16.4% or 52 policies which will get a better deal since the decrease ranges from $50 to more than $100 per month ($600-$1200 per year). 

This decrease can help a lot of people who might not want to risk the private sector holding back on their services. Generally, since the private flood insurance companies aren't bound by the government's red tapes, they can easily move out of an area once the risk of flooding becomes too uncomfortable for them. 

The Bad

Now, let's move into the bad news and bad changes that the Risk Rating 2.0 will bring to residents of Anchorage in Alaska. Only a mere 11% or 35 policies in force from FEMA will get an increase ranging from $0 to $10 per month ($0 - $120 per year). This is drastically smaller compared to other major cities we'll cover across this series.

You may want to prepare for these premium rate increases with this new Risk Rating considering how this portion of bad changes generally covers the bigger chunk of these changes.

This is why it's so important to understand these changes because you want to get the most out of your investment in flood policies when in proportion to the flood insurance coverage you'll get. Nobody would want to pay a higher amount, only to get covered for only $250,000 in a $500,000 home.

As you can see, Anchorage will be one of the cities that will get the best deals out of the risk rating changes.

The Ugly

Lastly, there's also an ugly change coming however this will only impact one policy in the city. This means that only 0.3% will get an increase of about $10 to $20 per month ($120 to $240 per year) on that flood insurance policy's price when it comes to premium rates from FEMA.

When Will It Happen?

Now, the date when you can adopt this program really depends if you're doing a renewal or if it's a new business policy. You see, you can expect these changes to start on October 1st and you're going to adapt to these rate changes if you're buying flood insurance from FEMA on or after that date. 

On the other hand, if you're doing a renewal with FEMA after that date then you don't have to take in these new rate changes until April 1st, 2022, or the date of your upcoming policy renewal.

So, you want to be very ready for this. We've been talking about this since last year since basically the NFIP is already 30 years old already and is in need of this change. 

If you have questions on these upcoming changes, what are your flood insurance options in Alaska, or anything about flood, reach out to us through the links below. You can also watch this on our YouTube channel.

Remember, we have an educational background in flood mitigation and we want to help you understand flood risks through education and awareness in flood insurance and preparedness.

Get Your Flood Risk Score Here!

We have already dove into the upcoming changes to the flood insurance rate in Alaska statewide in our previous blog. Today, we want to dive deeper into further understanding these changes as we focus on smaller parts of the state, the counties that are most impacted by these upcoming events to the federal flood insurance rates.

The Flood Insurance Guru | Anchorage, Alaska: New Federal Flood Insurance Risk Rating 2.0

In this blog, we'll cover the upcoming flood insurance policy changes to the largest city in Alaska, Anchorage.

Risk Rating 2.0

First, let's go through a brief rundown of the changes coming to the National Flood Insurance Program (NFIP) which is provided by the federal government under the Federal Emergency Management Agency (FEMA). These changes are through what's called the Risk Rating 2.0.

This is what FEMA calls equity in action when it comes to making the cost of flood insurance policies fairer per policyholder. Generally, this is because property values for each individual property will be accounted for when finalizing your quote and flood insurance premiums with the National Flood Insurance Program (NFIP).

It's important to note, however, that this won't mean that the cheapest flood insurance will go automatically to lower-valued homes. It's equally important that we take into account, just like FEMA does and the private flood insurance industry, what's called flood risk variables which includes, but is not limited to the following:

  • Designation in the flood zone maps.
  • History of flood incidents, flood damage, and flood loss
  • Flood claims made with the property
  • Flood hazard, the chance of flood, and impact of flooding
  • Risk of flood in the area and chance of flooding
  • Mitigation efforts made on the property. Is the lowest flood above the base flood elevation? Are there enough flood openings to let flood waters through?

NFIP: Federal Answer to a Flood Event

We encourage everyone to get a flood policy for your properties since flood happens everywhere and most of the time without notice. Regardless of your flood zone, flooding happens everywhere.

However, getting flood insurance is simply the first step in making sure that you're protected since it's equally crucial that you are up-to-date. Think of this one as your favorite app on your phone. Sure, you might have installed it years ago, but if it's not updated it's only going to cause problems long-term for the app you have. 

You have private insurance companies building up a community for private flood insurance and also the more widely known federal government and the National Flood Insurance Program (NFIP).

The Flood Insurance Guru | Anchorage, Alaska: New Federal Flood Insurance Risk Rating 2.0

These NFIP flood insurance cover both damages to the building and contents. When we say building, this generally pertains to a residential property or a commercial structure that gets flood coverage that maxes out to $250,000 (up to $500,000 for commercial flood policies only). At the same time, you'll also find contents coverage of $100,000 or the personal property you have listed with the insured building.

FEMA and the NFIP also help in other ways as well since policyholders are eligible for their Increased Cost of Compliance (ICC) and what's called the Community Rating System (CRS).

The ICC is an additional $30,000 flood coverage to give way for flood mitigation efforts for the insured property to avoid massive losses from a future flood event. The CRS on the other hand is a community-based rating system that measures the overall flood mitigation efforts made by the community in general; basically, this means that the higher your CRS score is, the bigger the discount

Today, we want to focus on the good and the bad changes to Anchorage policyholders with FEMA in this new rating methodology. The Risk Rating 2.0 and its changes will be starting this October 1, 2021.  

The Flood Insurance Guru | Anchorage, Alaska: New Federal Flood Insurance Risk Rating 2.0

The Good

We want to cover the good things coming to Anchorage first. We'll divide these good changes into two to specify the changes coming to flood insurance rates. This good change will bring an immediate decrease in the premium rates of those impacted. About 96.2% or 381 of the policies in the city will get impacted by this change.

The first half will impact about 77.5% or 307 policies will be getting a decrease that ranges from $0, which means there'll be no change at all, to $50 per month ($0 - $600 per year). The other half of this good change impacts 18.7% or 74 policies which will get a better deal since the decrease ranges from $50 to more than $100 per month ($600-$1200 per year). 

This decrease can help a lot of people who might not want to risk the private sector holding back on their services. Generally, since the private flood insurance companies aren't bound by the government's red tapes, they can easily move out of an area once the risk of flooding becomes too uncomfortable for them. 

The Bad

Now, let's move into the bad news and bad changes that the Risk Rating 2.0 will bring to residents of Anchorage in Alaska. Only a mere 3.8% or 15 policies in force from FEMA will get an increase ranging from $0 to $10 per month ($0 - $120 per year). This is drastically smaller compared to other major cities we'll cover across this series.

You may want to prepare for these premium rate increases with this new Risk Rating considering how this portion of bad changes generally covers the bigger chunk of these changes.

This is why it's so important to understand these changes because you want to get the most out of your investment in flood policies when in proportion to the flood insurance coverage you'll get. Nobody would want to pay a higher amount, only to get covered for only $250,000 in a $500,000 home.

As you can see, Anchorage will be one of the cities that will get the best deals out of the risk rating changes.

When Will It Happen?

Now, the date when you can adopt this program really depends if you're doing a renewal or if it's a new business policy. You see, you can expect these changes to start on October 1st and you're going to adapt to these rate changes if you're buying flood insurance from FEMA on or after that date. 

On the other hand, if you're doing a renewal with FEMA after that date then you don't have to take in these new rate changes until April 1st, 2022, or the date of your upcoming policy renewal.

So, you want to be very ready for this. We've been talking about this since last year since basically the NFIP is already 30 years old already and is in need of this change. 

If you have questions on these upcoming changes, what are your flood insurance options in Alaska, or anything about flood, reach out to us through the links below. You can also watch this on our YouTube channel.

Remember, we have an educational background in flood mitigation and we want to help you understand flood risks through education and awareness in flood insurance and preparedness.

Get Your Flood Risk Score Here!

The Federal Emergency Management Agency (FEMA) is rolling out changes when it comes to flood insurance rates across all states in the country. Today, we will unpack these changes coming to Alaska and how they can impact your flood insurance in the future.

Alaska Flood Insurance: New Federal Flood Insurance Risk Rating 2.0

Alaska has been a victim of multiple floods throughout the years and one can even say that the cold temperature is contributing to spring runoff, frozen bodies of water melting, or simply the overall oversaturation of the land. In this upcoming update with the Risk Rating 2.0 in the National Flood Insurance Program (NFIP), we want to look at the good, the bad, and the ugly changes.

Note that these changes, or the NFIP 2.0, will kick in on October 1st this year.

The NFIP 2.0

The Risk Rating 2.0, or commonly known as NFIP 2.0 as well, is more of a move of equity. This update on the federal flood insurance program itself will allow you to no longer pay more than your fair share when it comes to premiums as this would now be based on the value of your property or home starting this October. 

Alaska Flood Insurance: New Federal Flood Insurance Risk Rating 2.0

When it comes to the rate changes happening across the country, you're going to see these colors in ranges which are the green, blue, pink, and grey ranges. Now, each of these colors represents the good, the bad, and the ugly changes coming to each state.

For this one, we want to focus on Alaska which seems to be one of the states that are getting mostly good changes. Let's unpack these and see what they mean for flood insurance.

The Flood Insurance Guru | Flood Map Updates | Julesburg, Sedgwick County, ColoradoThe Flood Insurance Guru | Alabama Flood Insurance: New Federal Flood Program Risk Rating 2.0Alaska Flood Insurance: New Federal Flood Insurance Risk Rating 2.0

The Good

Residents of Alaska will be happy to know that most of the policyholders they have in the state will experience a decrease in flood insurance premiums. We call the green range bar on this Risk Rating 2.0 report the good change. In fact, the Risk Rating 2.0 shows that 86% (1,923 policies) will be in that green range. This means that these people will get an immediate decrease in flood insurance premiums of more than $100 per month. This eventually totals to $1200 per year.

It's important to note that out of these 1,923 policies, 200 of them are written for single-family homes across Alaska. Since these good changes are effective immediately, it means that you get to lower your rates once October 1st arrives.

Alaska Flood Insurance: New Federal Flood Insurance Risk Rating 2.0

The Bad

Now, if there are good changes, there will also be bad changes bound to happen. In the case of residents of Alaska — specifically, ones doing a flood policy with FEMA and NFIP — we're going to see about 12% of policies in the state experience this bad change. This is generally represented by that light blue range where you can expect that you'll get up to a $10 increase per month on your premiums (up to $120 per year).

This change will affect about 271 policies where about 77% of these policyholders are doing a single-family home flood insurance. Now, this may not sound as bad especially if you're going to look at the increase alone, but it's important to note that this increase of up to $10 per month will be on top of your flood insurance rate.

Alaska Flood Insurance: New Federal Flood Insurance Risk Rating 2.0

The Ugly

Lastly, we want to cover the 1% going in the pink and another 1% for the grey range bars. Now, these are what we include in what we call the ugly changes.

When you're part of the affected policies by this ugly change, you're going to get an increase in your rate from $10 to $20 per month. The pink range is less ugly than the grey area since this more of a range. Depending on your property value, you may get that $10 or that $20 per month which is about a $120 to $140 increase per year.

This is even uglier with the grey range since we're talking about more than a $20 increase in premium rates per month (>$240 per year) for those 24 NFIP policies in Alaska.

You can see a full graph of these changes below:

Now that we all know what these changes will mean, one of the questions you might be asking right now is when this is going to be in effect.

When Will It Happen?

Now, the date when you can adopt this program really depends if you're doing a renewal or if it's a new business policy. You see, you can expect these changes to start on October 1st and you're going to adapt to these rate changes if you're buying flood insurance from FEMA on or after that date. 

On the other hand, if you're doing a renewal with FEMA after that date then you don't have to take in these new rate changes until April 1st, 2022.

So, you want to be very ready for this. We've been talking about this since last year since basically the NFIP is already 30 years old already and is in need of this change. 

If you have questions on these upcoming changes, what are your flood insurance options in Alaska, or anything about flood, reach out to us through the links below. You can also watch this on our YouTube channel.

Remember, we have an educational background in flood mitigation and we want to help you understand flood risks through education and awareness in flood insurance and preparedness.

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