HOUSTON, TX — If you live in a rental property or looking to get one in Texas, you should know that there will be significant changes to flood insurance in the state. This generally covers apartments and those who rent a property from landlords. 

Texas Landlords are Required to Let You Know About Flood Risks

Today, we want to talk about the new law in Texas requiring landlords to basically disclose and notify renters of flood risks on their rental property before having these potential individual or family sign their lease. We also want to talk about how this can help provide more protection on flood risks and unwanted flood loss.

What's New?

When Hurricane Harvey hit Houston, it dumped more than 40 inches of rain over a short amount of time and flooded properties that had never been flooded before. Areas that were told they didn't need flood insurance got hit hard with flooding at that time. A lot of these areas were flooded because they sat between two reservoirs. 

Starting on January 1st, 2022, landlords are expected to notify potential people who are looking to rent their properties: from apartment to a single-family home, renters will get an idea and insight on the expected flood risks on the property you're looking to buy.

Texas Landlords are Required to Let You Know About Flood Risks

This is great news for more families in Harris County since most of these people rent properties. In a way, this is like a security deposit in a way that the renter will be aware of how much property damage they can expect once Texas gets flooded. 

Basically, if the property you're looking to rent got flooded at least once in the last five years or lives in the 100-year flood plain, your landlord has to give you a notification in writing as said by Texas Representative Armando Walle. The landlord failing to do so entitles the renter to break the lease agreement if the apartment gets flooded or substantially damaged due to floodwater. 

Why Change Now?

Now, most people would ask why is now the good time to have this law out there? Well, as we get through Hurricane Harvey, and now we've gotten through a whole year of back and forth with floods in Texas due to consistent heavy rainfall, this law is really coming in the right place at the right time.

As we fix these flooded properties or maybe some that are getting flipped when real estate investors buy them, they're going to have to disclose the flooding history of the property. This really does a great job protecting a consumer or buyer in the rental market. Now that we've addressed that side of the market, it's only fair that two years after we also provide the same amount of protection to renters.

Texas Landlords are Required to Let You Know About Flood Risks

A renter named Kenny Ryman was able to recall that during Hurricane Harvey, his apartment was flooded and he didn't have any clue about it. Despite living for 56 years in the rental property, he wasn't informed that the area flooded and caused a lot of property damage to Ryman.

Will this have an impact on the apartments and rental market in areas like Houston in Texas? Absolutely since these rental properties may not sell as much as they did before because you're having to notify whether or not these properties were flooded or not recently. 

So we just wanted to do a quick rundown on this Texas law change as this will definitely change the course of the rental market in Texas as well as directly impact the flood insurance premiums for these houses.

If you have more questions on this Texas law change, federal flood insurance, the insurance industry in general, how the National Flood Insurance Program works, or anything about floods. Reach out to us by clicking the link below.

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You can also visit our Flood Learning Center where we try to answer your most common flood insurance questions.

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Remember, we have an educational background in flood mitigation and we want to help you protect the value of 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.

How Will Hurricane Nicholas Impact Texas and Louisiana?

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.

How Will Hurricane Nicholas Impact Texas and Louisiana?

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.

How Will Hurricane Nicholas Impact Texas and Louisiana?

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.

How Will Hurricane Nicholas Impact Texas and Louisiana?

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.

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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.

The Flood Insurance Guru | Blog | Flood Threat On Texas

Before the month of May came, San Antonio and other parts of Texas experienced heavy rainfall over the weekend. This caused properties to experience flooding with the state being in a flash flood warning throughout the time. Flash flooding remains a threat after up to six inches of rain poured over the state over the weekend. A lot of roadways were severely impacted by this flooding across Nacogdoches and San Augustine stranding cars and drivers due to the flooded roadways causing damages across the state of Texas. Houston was also threatened with river flooding and is expected to go like this across the month of May. This can also mean that Houston may be at a higher risk when it comes to coastal flooding.

So, today, we want to cover what this can mean for flood insurance for Texans, how it could impact the flood policies moving forward, and your flood insurance options as well.

Impacts on Flood Insurance

As we're less than sixty days from hurricane season, flooding is expected to be more common across the United States, and in cases as the one Texas had, this can cause a lot of changes for flood insurance moving forward.

First, we want to share a tip that if your property's not severely impacted by the flood and only small amounts are impacted, don't file that flood claim immediately as this can cause your flood insurance rate to go up when it comes to renewal.  Instead, you want to make sure that the flood claim won't be misused by collecting and gathering all the relevant information on the damages you had due to this flooding. This way, you can get more out of the flood claim and avoid having the property marked under severe repetitive loss.

The Flood Insurance Guru | Blog | Flood Threat On Texas

Severe repetitive loss means that the property has had a flood claim, disaster assistance, or federal assistance grant more than once in the last ten years. This can cause flood insurance premiums to really go up for these properties through the Federal Emergency Management Agency (FEMA) and National Flood Insurance Program (NFIP). When it comes to the private flood insurance market, this can mean that these insurance companies will avoid writing a flood policy for these properties due to the higher flood risks it has considering its flood history.

Also, since there will be people who will file flood claims from the state in this period of time, we can also expect that there will be higher flood insurance premiums across the area as it's possible that the next flood map will move these properties into a higher risk flood zone. This means that a lot of property owners in Houston, Sweeny, San Antonio, and places like that will be required to carry flood insurance for their property. Those closer to rivers, the coasts, or any body of water may be moved into flood zone AE which generally will be required to carry an elevation certificate. An elevation certificate will have a separate cost from the standard flood insurance policy payments, so this can really hurt a lot of wallets in the future.

You may be asking right about now how you can fight these negative changes in flood insurance and what your flood insurance options are.

Flood Insurance Options

The NFIP

The most common flood insurance option that policyholders would usually go for is the federal flood insurance from FEMA. Now, we've mentioned multiple times that they have a max coverage for buildings and contents or personal items. This coverage is maxed at $250,000 for residential properties and up to $500,000 if it's written for a commercial building. Regardless of the type of building, this will have a max of $100,000 when it comes to coverages on personal property.

The Flood Insurance Guru | Blog | Flood Threat On Texas

What we want to focus on here is for those who are asking, what if I have an active policy with the NFIP and FEMA, what can I do to fight these changes? Well, there are several things you can do which involve relevant flood insurance documents that can help you reduce the flood insurance premium for your property.

The first thing is to use the elevation certificate if you believe that your property shouldn't be in a high-risk flood zone. If your property is about four feet above the base flood elevation level in your area then you can get a letter of map change (LOMC) which can remove you from the high-risk flood zone and get you back to low-risk flood zones with low flood insurance rates. It's important to note that this isn't a certain remedy for your situation as FEMA and the NFIP will have to assess the details that you provided.

The Flood Insurance Guru | Blog | Flood Threat On Texas

Another thing you can use to your advantage is to check with your local floodplain manager to see if your community is participating in the NFIP. Participating communities may get up to forty percent discount on flood insurance premiums depending on the Community Rating Score (CRS). The CRS is rated depending on how much flood mitigation efforts are being put out by your community and the more efficient mitigation efforts you do, the higher the discount could be.

Lastly, if you're looking to get flood insurance through FEMA and the NFIP, it's best that you do it ahead of time since there may be a waiting period of 30-days before the policy takes effect on your property. Now, if the NFIP flood policy doesn't really fit your needs and isn't the best flood insurance option, you can always move into the private flood market after canceling your NFIP policy.

The Private Flood

Private flood insurance is managed and provided by private insurance companies like Lloyds of London. This means that the red tapes that you have to go through with federal flood insurance won't be there. This can also have a faster effectivity date for those buying flood insurance since the maximum waiting period is fifteen days

When it comes to the private flood, coverage on buildings or properties and contents can be very different from the NFIP since they don't really have any coverage limits. This means that the amount they will cover won't be maxed out as long as the insured needs it. Property damage coverage can go up to $10,000,000 and personal items coverage can go up to $1,000,000. There are also additional coverages on private flood policies like additional living expenses, replacement costs, and loss of use

The Flood Insurance Guru | Blog | Flood Threat On Texas

Flood insurance premiums are expected to be significantly lower in the private market compared to the NFIP which can really help you when it comes to immediate flood preparedness actions.

As the risk of flooding become higher as we approach the hurricane season, we can expect dangerous flash flooding, flood waters becoming higher, threat of storm surge, torrential rains, and intensity of rain to be more frequent. This is why we always advise you to look out for tornado and flood warnings during this season and establish better flood risk communication with your local floodplain management team.

The Flood Insurance Guru | Blog | Flood Threat On Texas

At the end of the day, these types of floods can't be predicted nor controlled accurately, so you want to make sure that you're protected at all times.

If you have any questions about flood insurance or anything about flood, reach out to us. Remember, we have an educational background in flood mitigation and we want to help you protect the value of your property long term through flood education and awareness. You too can be flood-ready so you won't be caught off guard when crap happens. Click the links below to get started.

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So you have found out you are in a special flood hazard area. So now its time to find a flood insurance policy. 

So how do you pick the right flood insurance agent?

 

 

I mean all flood insurance is the same, right??

Today we are going to look at two approaches flood insurance agencies take when setting up flood policies. At the end we hope to help you pick the choice that is right for you.

First if a flood insurance company tells you all flood insurance is the same this is a great sign that they are not the right flood insurance agent for you.

All flood insurance is not the same. Even flood insurance through the National Flood Insurance Program might now be the same.

There are many things that could give someone a different rate. There are three things below that we will take a quick look at.

  1. Elevation certificates
  2. Policy assumption
  3. Grandfathering

 

Elevation certificates could show a big difference in rate. If this elevation certificate shows you are above the base flood elevation it could give you a great rate while without it the rate maybe much higher.

Policy assumption is another way that National Flood Insurance Program rates could be different. This is when one policy is signed over from one property owner to the next.

We have see more than $3000 rate here. You see when you set up a new policy with National Flood Insurance Program its based on current rates and guidelines.

However when a policy is assumed it is going off the guidelines of when the policy was set up. If this policy has been in place even more than a year it could be much cheaper rates. This is why we recommend looking at a policy assumption when possible.

So what about grandfathering?

 

Trust me grandfathering can make a big difference in rates when available. I know I had to grandfather my own property in Monroe Georgia almost 10 years ago. 

I was told flood insurance would be more than $3000 a year. However because of my educational background in flood mitigation and understanding grandfathering my rate $350 a year.

So as you can see there can be a lot of differences in rate with the National Flood Insurance Program.

However you also don't want to forget about private flood insurance. If someone tells you it doesn't exist or they don't offer it then they might not be the right flood insurance agent for you. Private flood insurance can offer some unique coverages and pricing.

Now lets look at transactional and consultative

Transactional Flood Insurance Agencies

Transactional flood insurance agents or agencies many times are trying to make the process as quick and painless for you. There can be some benefits to using them like the cheapest rate some times and getting things done quickly.

These type of agencies are usually based on volume so they are doing a lot of these policies everyday.

However many times where this can be a danger is picking the right coverages and long term impacts.

On these transactional agencies many times they will have you pick the coverages or will put what the mortgage company requires. This can be dangerous if you are like most consumers you probably aren't sure what coverages are needed for flood insurance.

To give you an example of these I spoke to a client yesterday that wanted 8,000 in contents coverage for his lake cabin. We started talking about furniture and personal belongings in the cabin. It had at least 50,000 worth of stuff. So we recommended about 100,000 in contents coverage for them.

You generally may not get this with a transactional flood insurance agency. Now let's look at the long term impacts. Many times these transactional flood insurance agencies do not look at long term impacts on the customer.

We are talking about long term rates and the impact of flood insurance claims. Wouldn't it be nice to know how stable flood insurance rates are in an area over a 5 year period. Wouldn't also be nice to know how flood insurance claims might impact you before filing them.

These are some of things you don't get with a transactional flood insurance agency. Now let's look at consultative flood insurance agencies.

 

Consultative Flood Insurance Agencies

Have you ever had a problem you needed help walking through and wanted to know what solutions are available. You might even need help getting to these solutions. This is exactly what consultative flood insurance agencies do.

They walk property owners through the following things

  1. Flood insurance coverages
  2. Flood insurance options
  3. Flood zones
  4. Flood mitigation
  5. Long term rates
  6. Impacts of flood claims

So let's look at flood insurance coverages first. These type of agencies or agents walk customers through understanding building coverage, contents, coverage, loss of use when available, and deductibles.

Consultative flood insurance agencies generally do a good job of using examples of when each coverage would be needed.

For example the difference in coverage for appliances and furniture. One might be part of the building and the other one may not.

Then there is flood insurance options. This is where a consultative flood insurance agency could save you a lot of money and headaches long term.

A good consultative flood insurance agency shows the customer the difference in the national flood insurance program and private flood insurance companies.

 

They show them the benefits and negatives. For example what if you saved a $100 by switching to a private flood insurance policy this year. However it cost you a $1000 more next year. Wouldn't be nice if someone could show you that.

Now when it comes to flood insurance rates a consultative flood insurance agency may not have the cheapest rate but it can be the best policy. No one cares how much money they saved when a flood insurance claim occurs and they have nothing.

This could help you as a property owner make a better decision on flood insurance.

So what about the long term impact of flood insurance claims.

Flood insurance claims work differently than property claims. When a traditional home insurance claim occurs it might stay on the insured and property record for 3-5 years. If the insured goes to buy another home this claim might hurt them. This is not the case with flood insurance claims as they follow the property.

However flood insurance claims can stay on the property forever. For example many private flood insurance companies will not insure a property that has ever had a claim. Others may not want any claims in the last five years.

So what if you filed a $1500 claim on a policy with a $1000 deductible? Well if it s a private flood insurance policy then the policy could be non renewed.

In fact we recently saw this happen with a property owner 2 weeks before renewal. They ended up having to go back to the National Flood Insurance Program with a rate that was $5000 higher.

These are the type of things that consultative flood insurance agencies can help you avoid.

So you might ask what is The Flood Insurance Guru?

We pride our selves on being a consultative flood insurance agency.

So if you have further flood insurance questions or how to pick the right agent click here.

You can also check out our daily flood education videos on our YouTube channel.

You can also tune into our podcast by clicking here.

Remember we have an educational background in flood mitigation. This means we are here to help you understand your flood insurance, flood risk, and mitigating your property long term.


 

 

 

 

Over the past month I have done a lot of traveling shooting flood education content. On those travels I have been in places that have been hit hard by flooding over the last few years. I traveled to Houston, Galveston, and Wimberly Texas. These areas have all see major flood damage over the last few years.

These areas also house many secondary and vacation homes for property owners. Some of these properties have seen minor flooding and some have seen major flooding. Many of these areas have seen loss of life as a result of flooding.

Blanco River flooding Wimberly Texas

As Tropical storm Beta approaches these areas and is expected to drop large amounts of rainfall and storm surge we want to look at what you can expect when it comes to your Texas flood insurance policy.

Through out these two areas in Texas people have two different types of flood insurance. They have the National Flood Insurance Program and they have private flood insurance. These two programs can be pretty different when it comes to coverages. Most people jump to the private flood insurance market when they can because it's cheaper and you can get better coverage. I think many people through our Port Aransas, Houston, and Galveston will tell you to read your policy.

galveston Texas coast

We mentioned earlier many of these properties are secondary or seasonal properties. What you may not know is many private flood insurance companies default to an actual cash value basis on these policies.

So what exactly does that mean for your Texas property?

Well it means you won't generally get the full amount on your policy. If you have a $250,000 flood policy you may only get $125,000. That could be a big surprise couldn't it. Thats exactly what happened to a lady in Houston after hurricane Harvey hit. She had a $150,000 flood policy that only paid out $15,000.

So you ask why?

Well she did not insure to 80% of replacement cost or the $250,000 max that the National Flood Insurance Program offers so her policy defaulted to actual cash value.

Thats a big shocker. So when you are setting up this flood insurance policy or if you ever change your flood insurance policy in Texas you want to have your insurance agent highlight these areas of the policy. When switching private flood insurance carriers make sure you are truly getting replacement cost on your policy up to the amount you have listed on the policy.

Maybe you don't have an agent that has done this or you don't have an agent at all?

Then click here and we will be glad to do a review with you.

While there are multiple options for flood insurance in Texas you want to make sure you are getting the policy that is right for you.

So if you live in Texas and want to learn more about your flood insurance options then make sure to check out our daily flood education videos on our YouTube channel. You can also checkout our podcast for this video here.

 

Remember we have an educational background in flood mitigation. This means we can help you understand your flood risks, flood insurance, and mitigating your property to help you minimize flood losses and flood premiums.

 

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Texas has seen its fair share of flood disasters over the last 5 years. Hurricane Harvey in 2017 devastated the city of Houston flooding many commercial properties that were told they were not in a flood zone. Then there was tropical storm Imelda in 2019 that brought almost just as much rain fall as Harvey. Commercial properties even flooded during Imelda that didn't flood during Harvey.

 

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While these two disasters could be considered two of the top flood disasters in the last 25 years is this enough reason for commercial flood insurance companies to take a one way ticket out of town?

Since Harvey private flood insurance companies have really been limiting their exposure in areas like Houston and Galveston Texas. However now we are starting to see this limitation across the state of Texas. Other flood disasters like the flooding in Oklahoma and Nebraska have put even more pressure on them as they try to manage the commercial flood risk properly.

This is one of the big differences between the National Flood Insurance Program and private flood insurance companies. The National Flood Insurance Program also known as NFIP is backed by FEMA and is not built on profitability like private flood insurance companies are designed to be.

For this reason you will not see NFIP pulling out of areas after a flood or limiting policies. The NFIP was designed to provide flood insurance to property owners as long as the community participates in the NFIP.

So what about those communities in Texas that do not participate?

What flood insurance options are available for them?

These particular communities only have access to private flood insurance so when these options start to become limited it can have a major impact on these non participating communities and businesses.

So what else could be scaring away commercial private flood insurance companies in Texas? Well there are two things we want to discuss

  1. Flood maps
  2. Climate change.

Let's look at flood maps first, flood maps being updated is no short process. A flood insurance study report has to be done which can take several years to complete and then FEMA and local communities have to agree on the new maps. This is one of the major issues that occurred in Houston and Harris county Texas. When hurricane Harvey hit new flood maps had not been agreed upon and many areas that were showing low risk should have been high risk.

As a result 85% of the properties that flooded during hurricane Harvey did not have flood insurance. One reason was the misbelief that they were in a low risk flood zone where it really should have been a special flood hazard area where flood insurance is required.

Another area that was the victim of flood maps was Baton Rogue Louisiana during there famous flood in 2016. Right before this flood many areas had been moved to low risk flood zones and the mandatory requirement for flood insurance had been removed.

As a result many property owners did not have flood insurance as they had just cancelled it.

These are only two scenarios but there are many more we can look at where flood maps are creating false security. You see the water is not going to knock on your door and ask to come in.

As you can imagine this inaccurate mapping process would scare any flood company. Thankfully new technology has helped private flood insurance companies get a more accurate risk on these flood prone areas. This is also one reason why so many of these low risk flood zones have better ratings with NFIP than private flood insurance companies. The private flood insurance companies can see the true risk and rate it correctly.

So what else might be running commercial flood insurance companies out of town?

Well its two words that no body wants to discuss which is climate change.

We aren't necessarily talking about global warming but instead how patterns can change for certain areas. Looking at Harvey and Imelda you can clearly see that these two storms dumped more rain than most hurricanes. According to Live Science Imelda was one of the wettest storms in U.S. history.

However let's look at some other areas of the country to get a true comparison. The Nebraska, Iowa, and Oklahoma flooding saw one storm after another early in 2019 causing wide spread flooding for several months.

North Alabama saw the same thing happen in 2019 when power companies could not handle the amount of water coming through their managed water sources causing flooding in low risk areas like Florence Alabama.

In 2020 we are starting to see the same thing occur in North Alabama again as they are expected to get hit with a rainstorm that will drop more than 3 inches of rain for the third time in 3 weeks.

It's important to understand that currently climate change is not factor in flood insurance rates. Its something that is being reviewed for NFIP Risk Rating 2.0 in 2021, but there are no guarantees it will be implemented.

So then what happens when you have inaccurate flood maps and climate change that you can not necessarily forecast. You have an unpredictable flood risk model that makes it very difficult for companies to manage risk properly.

As a result you have companies moving out of those areas or best case scenario limiting the amount of business they do in these areas.

Generally the first thing they start to do is limit areas within 5 miles of the coast and then coverage amounts. This can make commercial flood insurance very difficult to find as most banks require $500,000 on each special flood hazard area property.

Now as mapping improves, technology improves, and climate change forecasting improves you may start to see more private flood insurance options available in areas like Houston Texas. However for the time being expect to see options become more limited until these things happen. Some important things to look at in these areas are mitigation efforts you done to the property to help minimize the risk.

Maybe you have put flood vents on your property, maybe you have dry proofed the property, or even raised the building. These are all factors that could give you more flood insurance options.

So if you want to know what your flood insurance options are in Texas or how your mitigation efforts might impact your flood insurance options then make sure to visit our website. You can also check out our YouTube channel or Facebook page where we do daily flood education videos. You can also tune into our daily flood podcast.

 

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

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

What Will Impact be in League City

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

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            Property Values

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

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

Impact on Mortgage

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

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

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

 

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What are the Options

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

National Flood Insurance Program

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

 

Private Flood Insurance

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

Can You Fight It

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

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

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