Flood insurance is what might be one of the most important coverages you can get nowadays. A single flood policy can provide flood protection for thousands of dollars. However, did you know that not only residential homes and commercial buildings can get flood insurance?

In this article, we want to talk about how you could protect your flood insurance premiums as a landlord, or apartment building owner, and make flood insurance easier for you, your property, and your renters.

Flood Insurance for Apartment Building Owners

When it comes to flood insurance as an apartment building owner, you want to make the most out of your investments. Considering how most of your properties will be one of the sources of your income, it's best to help them avoid getting ravaged by flooding. This will not only impact your property but also the potential customers you may have in the future.

So let's talk about the things you can do to make utilize your flood insurance best. We will talk about the following things:

• Blanket Flood Insurance Coverage
• Loss of Use
• Replacement Cost & Elevation of Structure

Blanket Coverage

First, it's important to know the type of flood insurance coverage you need to get for your property. This may be through individual/specific flood coverage or blanket flood coverage.

The difference between these two is that individual coverage is only specific to a single property. So the building and personal property coverage with your flood policy will only be applicable to a single structure. This is not really ideal if you have multiple properties.

On the other hand, you may be able to get a blanket flood insurance policy; which really eliminates most of the limits you will see on an individual flood policy alone.

Blanket insurance means that you may get the same flood insurance coverage for multiple properties with just a single policy. This means that flood coverage for flood damages may apply to more than one type of property at the same location or the same type of property at multiple locations.

It's important to note however that the Federal Emergency Management Agency (FEMA) and the National Flood Insurance Program (NFIP) generally don't offer blanket flood insurance coverage however you can still get one through other private flood insurance companies.

Loss of Use Coverage

Now, let's jump into one of the things that you should be looking to include with your flood insurance policy: loss of use coverage.

Loss of use is generally an additional coverage that you can get with flood insurance. The purpose of this coverage is to provide you with actual cash or any form of reimbursement for you as the property owner of a rental property.

When your property gets hit by flood, as the repairs are ongoing, you won't really have use of the property. With this coverage, instead of not being able to earn anything as the repairs are ongoing, the flood insurance policy may provide you with whatever potential income you are losing during that period.

Replacement Cost & Elevation of Structure

Last on our list is the replacement cost value of your property and why protecting it from flood damage can directly impact the profitability of your property as an apartment building owner.

Replacement cost is simply the amount or cost of the property's structure if you were to sell it on the market. For flood insurance, this is generally considered because the replacement cost will be the basis for your flood insurance rates. So if you have a higher or more expensive amount for the building, you may also start to see some form of an increase in your rates.

It's equally important to also consider the elevation of your property because this generally shifts your risk of flooding. An elevation of your property will also help show that you are at a reduced risk for flooding.

This is why despite elevation certificates being no longer required for flood insurance, it still is a helpful document in lowering your risk and sometimes even removing your property from a flood zone.

Protecting Your Premium Rates

When you start processing the purchase of flood insurance, it's best to consider these three things in order to protect your premium rates. This is really important especially if you have a building that sits in a high-risk area where the chance of flooding is not only high but also sometimes unpredictable.

As a property owner of apartment buildings, you may want to make the most out of your flood insurance coverage. For the federal flood insurance side of the market, you may start seeing a max of $500,000 on your building coverage.

Although the private flood insurance market has more flexibility with coverage amounts, meaning you can go further than $500,000 for your building coverage, this won't really guarantee that you can lock in on your premium rates.

One of the biggest risks of a flood-prone property is that you also lose interest and appeal to your potential customers. If people start to see that your property is a high-risk one when it comes to flooding and damages, renters might choose another option. This in turn will hurt the profitability of your property long-term.

If you are ready to take the next steps to get the right flood insurance coverage then there are three simple steps.

• Fill out this form —
• Talk with our flood education specialist.
• Get back to the important things in your life.

Got more flood insurance questions? Visit our Flood Learning Center below to know more:

Alabama is no stranger to flooding. Be this due to consistent rainfall to hurricanes making landfall near the state, almost throughout every year, Alabama will be a victim of this type of natural disaster.

Today, we want to do a deep dive into why flooding is very common in the state and discuss the three most common flood zones in The Heart of Dixie state.

Lookback on Alabama Floods

The state is no stranger to floods especially due to flash flooding. Most of the counties in the state face flood as one of the biggest challenges from heavy rains to tropical storms passing by.

Despite having only one named storm in the last quarter of this year, it doesn't mean everything will be calm. We're still seeing a lot of rainfall and persistent precipitations across the country. In most cases, these conditions are enough to cause enough flooding and damage to multiple areas.

Take note, this is without a tropical storm present and at the most extreme caused by monsoons. Why is this happening you might ask?

We can owe it to what's called the La Niña. La Niña is a "cold event" wherein trade winds are stronger than usual which pushes more warm water toward Asia. Being the exact opposite of El Niño which is commonly known as the "heat event" that leads to week-to-month long droughts in South America and California, La Niña is a mixed bag of weather conditions that are very unpredictable and usually exceed the expectations.

This generally causes some areas of the United States to be very dry while some get very wet. To give an example, 80% of Stanislaus County in California is experiencing very extreme to exceptional drought hence the "very dry" conditions. Add this to the already dried-up ecosystem due to the wildfires, it's no question why the drought continues in the state. However, it's equally important to note that these types of events may just be scratching the surface when it comes to the dangers it presents to locals.

On the other hand, if we look at areas like Washington, a lot of atmospheric river impacts are being felt due to La Niña hence causing floods in the area up to the northwestern regions even in British Columbia. We've also seen how the shift from having warm surface water to a much colder one impacts the weather in areas like Northern California. The northern part of the state recently had to face devastating damages due to atmospheric rivers causing an extreme rain event in the area.

These are just a few of the examples we're seeing in the past few weeks however this doesn't mean that everything ends there. We can still expect more effects of the "small girl" as we end the year and go through the winter season.

Most Common Zones in Alabama

There are three most common flood zones we see the cover of the households in Alabama, these are Flood Zone X, Flood Zone A, and Flood Zone AE.

Other than the letters you might be wondering how these flood zones differ, so we'll discuss that

Flood Zone X

If your property is "not in a flood zone" then you're most likely to be in a flood zone X. Generally this zone has the lowest flood risk due to its relative distance to floodplains where flooding commonly starts. This simply means that flood insurance generally isn't required since the probability of a flood or risk of flooding, and impact a building or property in such zones is much lower than other flood zones.

Keep in mind that we're talking about a low-risk zone and not a no-risk zone. This is generally due to flash floods being more commonly experienced by flood zone X which causes significant flood insurance losses due to the damages.

Some mortgage and/or insurance carriers would also call these preferred flood zones. This is called a preferred zone since it has more favorable rates for the homeowner and risks for the insurance carrier. Even with FEMA, being in a low-risk zone brings a lot of good things because Flood Zone X has lower rates even in flood-prone Alabama. 

As we move into Risk Rating 2.0 where flood zones don't impact flood insurance rates, if your property sits on a Flood Zone X, you won't be required to carry flood insurance. However, it's important to remember that 30% of flood insurance claims do come from the homes in Flood Zone X.

Flood Zone A

Let's say you move into someplace else and the property or building is marked as moderate to high-risk flood zones.  Flood insurance is mandatory in areas under Flood Zone A on a property(s) with a mortgage or any additional interests in the property or building.

Generally, this zone falls outside of the preferred zones due to higher changes and flood risk overall. In FEMA's legacy program, this is where you'd start seeing some significant increase in the rates of your flood insurance policy. 

Another important thing you should remember about Flood Zone A is that its base flood elevation isn't determined yet many times. This makes it a challenge for flood zone changes and flood maps since there's no assurance where the base flood elevation starts. You might wake up one day with your kid's teddy bear soaked under 3-feet of floodwater... or maybe not.

 

In this case, do keep in mind that when someone tells you to give your house an elevation certificate or you need flood vents for your home, you should always think carefully multiple times if you're standing on Flood Zone A; you wouldn't want your wallet drained of money.

In regards to Risk Rating 2.0, flood zone A simply means that you will be required by your mortgage or FEMA to carry flood insurance on your property. However, being in a higher-risk zone will no longer cause an increase or any impact on your premium rates.

Flood Zone AE

Lastly, the area where lifeboats should also be considered a necessity. All jokes aside, this zone has the highest risk when it comes to flood zones outside of the coasts and is also known as a 100-year flood zone.  Since Flood Zone AE has a 0.2% to 1%  flood threat at any given month and/or year as it's getting closer to the coast.

Unlike the previous high-risk zone, most properties in the AE zone have determined base flood zones. This is also why it's a higher-risk zone compared to the A zone. Due to this, FEMA and other floodplain management agree that certain conditions can be enough to cause small floods, flash flooding, or widespread floods in that area.

Like Flood Zone A, this zone also requires and mandates that a property must have flood insurance in place especially when there's a mortgage and/or any additional interests.

You don't have to worry since you have options in getting your flood insurance to secure your property values: the National Flood Insurance Program (NFIP) or through the private market (private flood insurance). 

Not being aware that you're moving into a special flood hazard area can cause an immeasurable headache for your bank as flood insurance will be required no matter what, and when someone tells you to give your house an elevation certificate, you should probably consider getting one with some flood vents if possible as this can help lower your rates even in Risk Rating 2.0.

Despite removing flood zones as a basis of rating in Risk Rating 2.0, flood mitigations like installing flood vents, securing elevation certificates, elevating your home, and other mitigation efforts are appreciated and will bring you enough decrease to make that FEMA rating easier to manage.

Flood Insurance Guru: Alabama

For this part, we really want to share our experiences serving homeowners and business owners alike when it comes to the residential or commercial properties they want to protect from flood damage and flood loss.

Looking at our data over at Flood Insurance Guru, about 25% of the flood policies we were able to handle in Alabama are currently zoned in Flood Zone X. However, considering that there is impactful development when it comes to the behavior of water and frequency of runoff and flash floods, even low-risk zones aren't really that safe from flooding.

On the other hand, about 21.2% of the policies we have for Alabama are in Flood Zone A. This can be very alarming, if this number rings true to all properties in the state, as homeowners and floodplain management don't really have a clear insight when it comes to the base flood elevation for at least 20% of the properties across the state.

Lastly, in our database for the customers, we have from Alabama. At least 53.7% are mapped into Flood Zone AE. When it comes to floods, this means that more than half of the properties in Alabama have identified base flood elevation and also are more flood-prone due to possible floodplain devolvement.

As you can see, most of the properties in Alabama are in a flood zone. Regardless of being in a Flood Zone X, A, or AE, properties will still get flooded. Basically, saying that a house is "not in a flood zone" is a myth. We want to raise awareness for these types of things especially since flood insurance is something that you really don't have included in any other insurance.

If you have questions on your flood zone in Alabama,  what are your flood insurance options in the state, or anything related to flood and insurance, click the links below to reach us. You can also access our Flood Learning Center by clicking its graphic below.

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

Since the beginning of time, we were always accustomed to thinking that fire and water can only destroy one another. What if I told you that in the case of California, fires actually worsen the amount of water that we get when there's flooding.

Today, we want to discuss how these fires in California have been impacting the flooding on the west coast and communities can best prepare themselves for this type of condition.

Fire and Floodwater in California

If you told people outside of the west coast that fires and drought can lead to worse floods, some might find it hard to believe however this is the perfect cocktail that's been ravaging the western areas of the country and most specifically California.

At the time of writing, a bomb cyclone and atmospheric rivers caused a lot of flash floods, toxic runoff, rockslides, and mudslides after a significant amount of rain was dumped in the area. We've covered this topic in our previous blog. What we want to focus on is how even in recent times, this tag team of wildfire and floods are causing a lot of trouble in California.

If we look back in 2018, Butte County and Los Angeles were hit with 1 and a half inches of rain which is fairly common anywhere else, but this was enough to cause catastrophic flooding. How did that relatively small amount of rainfall be enough to cause floods?

Well, at the time that this happened, California's soil was badly scarred by the deadliest wildfire in history. The flood was due to the fact that the soil in the area was totally incapable of holding any of that water so it just caused all of the debris to flow into nearby areas.

Fires Becoming a Flood Risk

It's highly noticeable, even without looking at the numbers, that the risk of flooding in California is significantly high. This is highly due to the constant fires that are also constantly presenting potential impacts to future floods. The risk of floods in these areas is also significantly dangerous due to destructive debris flows which contain all the toxic chemicals from burnt materials.

These debris flows are commonly due to the surface erosion that we're seeing in areas where there has been a fire. A fire can easily destroy the overall quality of the soil in these areas which is why a small amount of rain becomes the biggest flood hazard with equal destructiveness to the fires themselves. Equally, when that toxic debris flows get into the water supply, there's also a health risk being presented to the residents of the impacted communities and/or areas. 

These threats can happen even with a small amount of rain and it escalates further when we start to talk about heavy rains. The stronger the rain in these areas is, the more vicious the debris flows become, and once this flows into reservoirs and dams, it's a bigger problem for these communities.

How Flood Insurance Helps

Flood insurance is becoming more relevant now with the current climate change and it's one of the most essential insurance policies you can have. It's important to note that flood damage to your property won't be covered by any other insurance other than flood insurance.

In the case of California and the current condition it's facing with the bomb cyclone and atmospheric rivers, we encourage that each resident will get one for their property since there's a lot of flood hazards going around presented not just by rain, but also through those wildfires.

Flood insurance covers any loss that was resulted because of a flood. Any surface water will be considered as a flood once it affects at least two acres of land or two properties. This means that what happened in California and the west coast due to the bomb cyclone already qualifies for flood insurance coverage.

Flood Insurance Options in California

When you buy flood insurance from the government-backed market under the Federal Emergency Management Agency (FEMA) and the National Flood Insurance Program (NFIP), you will get covered for both dwelling and contents. Dwelling coverage or building coverage will max out at $250,000 and contents coverage will max out at $100,000.

This will be all of the coverage you'll be getting through FEMA and the NFIP. The only other additional coverage you can get is the Increased Cost of Compliance (ICC) which can really help you protect your home from floodwaters. This is an additional $30,000 solely dedicated to flood mitigation however it must be said that this is something that your community should apply for.

You can learn more about federal flood insurance and the NFIP Risk Rating 2.0 by checking out our previous blog.

On the other hand, you also have the private flood insurance market which offers no coverage limits on their flood policies. This means two things: one, you don't have to take up all that $250,000 even when you don't need it and, lastly, you can make sure that you get covered for more than $250,000.

Private flood insurance also helps you find more peace of mind as it can also provide replacement costs, additional living expenses, and loss of use.

Regardless of your flood insurance carrier choice, it's still best to keep a policy intact with your property. Climate change is drastically changing the landscape of how natural disasters — from droughts to sudden downpours of rain — and we must be vigilant to keep up with these changes.

If you have any questions on how fires impact flood insurance, where your flood insurance coverage starts and stops, or anything about floods, click below so you could call us or go to our Flood Learning Center where we try to answer your flood insurance questions.

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