As we move into the biggest changes coming to the National Flood Insurance Program (NFIP) with the upcoming Risk Rating 2.0 Program, Tulsa City in Oklahoma clutched the game with a buzzer-beater of achievement when it comes to federal flood insurance.

Tulsa Flood Protection Above and Beyond

Today, we want to talk about what the recent Community Rating System (CRS) score change in Tulsa impacts flood insurance premiums for its locals.

Flooding and Oklahoma

At the time of writing, the South Central parts of the country including Oklahoma are facing a lot of rain as storm fronts stalled in the area. This weather condition adding up to the drought that Oklahoma is experiencing is one messy cocktail when it comes to flood.

When there's a drought, you can think of rain as water hitting hard cement. The soil won't be able to suck all this water in thus causing it to redirect to low-lying areas. In turn, this means that no one is safe when it comes to flooding.

However, this might not be a big of a concern when it comes to Tulsa since the local government and the community itself did a power move when it comes to flood mitigation by raising the city's community rating system.

But first, what is the Community Rating System (CRS)?

CRS Saves Lives Like CPR

The Community Rating System (CRS) is what we'd like to call the double-edged sword to flood insurance with the Federal Emergency Management Agency (FEMA). This is generally due to the fact this system created by the federal government encourages people to buy flood insurance and lowers the overall risk of flooding of property by rewarding a participating community with discounts to flood insurance rates.

Basically, this means that the more flood mitigation is done by a community, the higher the discount is for their policyholders. This is why both the federal government, private flood, and even our team encourages actions or measures for flood damage reduction. You get to save your property and avoid substantial damage to your safety and property while lowering your rates with your flood policy.

Tulsa Flood Protection Above and Beyond

Activities in the Community Rating System are organized in four main categories: public information, mapping and regulations, flood damage reduction, and warning and response. Stormwater management, drainage system maintenance, and floodplain development regulations

This discount can really save policyholders a lot of money since it goes up to a 45% discount if the community gets the highest class rating. Based on the flood mitigation measures made by the participating community or city, you will be categorized ranging from Class 10, being the lowest and having no discount, to Class 1, being the highest with a 45% discount on flood premiums. This type of discount is significantly better if we were to compare it to other insurance companies in the private market.

This program is significantly helpful since it allows more people to get into federal flood insurance and save themselves from empty wallets or debt especially in this COVID-19 pandemic scene.

What did Tulsa do and what reward did they achieve with this?

Tulsa Gets Rating Class 1 in CRS

Now, back on the topic of Tulsa City in Oklahoma where the local community was able to secure the Class 1 Rating with their CRS. This means that flood insurance with the National Flood Insurance Program (NFIP) and FEMA will have a 45% discount for both old and new policyholders. This is also inclusive of the standard flood insurance coverages for residential, commercial, and even rental properties. Tulsa is one of two cities in the whole country that achieve this rating score; the other being Roseville, California.

It's notable to mention that at the time of writing, Oklahoma averages about $950 when it comes to flood insurance premium rates. With this move up to a higher class rating with the CRS, flood insurance premium rates will get a discount of at least $430 based on the average.

Tulsa Flood Protection Above and Beyond

It's important to mention however that once we move into the new Risk Rating 2.0 program, we're going to see a slight increase with most areas in the state of Oklahoma. Regardless, this new CRS score will still be applicable to that. Considering that Tulsa is covered by multiple counties such as Osage County, Rogers County, Wagoner County, and Tulsa County, the 45% discount on flood premiums will impact a lot of people in a great way.

At the time of writing, about 70% of the city will be getting a slight increase of up to $10 per month (up to $120 per year) in premium rates and about 8.8% of policyholders will get more than $10 per month increase (more than $120 per year).

This type of effort of the people not only reduces the resident's overall flood damage and risk for flooding but also ensures that everyone will be able to get protection through flood insurance with FEMA and the NFIP.

What We Learned From This

Each year, flood insurance costs seem to only get higher and higher and in some areas, this can cause a lot of people to be discouraged in buying flood insurance at the expense of their safety and security against flood damage.

With programs like the Community Rating System lowering flood insurance when people take flood mitigation measures really help a lot of people and their local governments find encouragement in exerting effort into lessening the damages that flood brings to properties. Property owners don't just ensure their properties with flood insurance but start to mitigating their properties.

This type of reinforcement helps the case of all homeowners and business owners across the country especially when we're still living in a time where a lot of people underestimate how deadly floods can be.

It's safe to say that we should follow the steps done by Tulsa City in ensuring that they make the most out of flood insurance.

If you have any questions on flood insurance discounts, FEMA flood policies, flood insurance options in Oklahoma, or anything related to floods, click below to reach out to us or access our flood learning center.

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

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 Oklahoma and how they can impact your flood insurance in the future.

The Flood Insurance Guru | Oklahoma Flood Insurance: New Federal Flood Insurance Risk Rating 2.0

Today, we're going to discuss the upcoming changes to federal flood insurance in Oklahoma. The Sooner State has multiple bodies of water within the state and close to the state's borders like the Canadian River, Arkansas River, and multiple lakes and reservoirs. This can present a huge risk when it comes to flooding. Early in June, Eastern Oklahoma faced a lot of flash floods causing some major roads to be inundated with water and impassable.

Understanding your individual flood risk and getting a flood insurance policy for your property is a great start however this won't really do much if we don't understand the upcoming changes to your policy regardless if it's a policy from the Federal Emergency Management Agency (FEMA) or private flood insurance industry.

This is why it's important to discuss your federal flood insurance with the National Flood Insurance Program (NFIP) which will have a lot of updates and changes with The Risk Rating 2.0.

Nowadays, the biggest flood damage doesn't come from the flood water itself, but the protection you have once floods happen.

The Risk Rating 2.0 will arrive on October 1st, 2021.

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. 

It's important to note that property values won't be the only thing that comes into play in finalizing your flood insurance premiums with FEMA. This doesn't immediately mean that only property owners with expensive properties will get premium increases and all lower-valued homes are expected to get a decrease. There are also flood data that FEMA considers and you might want to consider them too. These things are:

  • Overall risk of flood on the insured property and flood frequencies in the area
  • History of flood damage and flood loss over the last 10 years
  • Mitigation efforts on the insured property. Is your lowest floor raised above the base flood elevation? How many flood openings that the structure has?
  • Proximity to a possible flooding source (rivers, lakes, reservoirs, creeks, etc.)
  • Designation in Flood Insurance Rate Map (FIRM). Is the property in high-risk areas or not?

Since the NFIP generally follows the 30-day waiting period before they can have your policy take effect on the listed structure, be it a residential property or a commercial one. The National Flood Insurance Program can cover flood damages on your building which maxes to $250,000 and contents up to $100,000.

The Flood Insurance Guru | Oklahoma 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 represent these changes with flood insurance rates from FEMA. Now, each of these colors represents the good, the bad, and the ugly changes coming to each state.

The Flood Insurance Guru | Oklahoma Flood Insurance: New Federal Flood Insurance Risk Rating 2.0

The Good

Let's start off the day with some good news. This will be shown as the green portion on the graph and will impact 30% or 3,856 policies in the state.

This is a good change for these residents because their flood insurance rate will get a decrease of $100 or more (>$1200 decrease per year) on their policies once the Risk Rating 2.0 kicks in.

This decrease can really help a lot of people in the states especially when the average premiums with FEMA is around $1000. This amount can definitely become bigger the closer you are to those bodies of water and the data that FEMA has on your property like flood claim history, property value, and flood mitigation efforts.

The Bad

When there's calm, there's also storm and with the good change also comes the bad change. This one will be represented by that blue portion in our graphs.

We call this the bad change because generally all this part does is get you an increase on flood insurance rates with FEMA. This is something that about 60% or 7,920 of the policyholders from FEMA will experience in the state.

The increase will be ranging from $0 to $10 per month ($0 - $120 per year). This means that you will either stick with the current rates you're paying right now (the $0 increase) or you're going to start paying a higher rate (up to $10 per month).

The Ugly

Lastly, we'll cover the remaining portions in this new Risk Rating: the pink and the grey ones. Both of these will still cause an increase on rates for those impacted however this time around it'll be a storm of headaches since it's going to be significantly bigger and one of them is definitely uglier of a change.

The pink portion will impact 6% or 722 policies in Oklahoma. This time around the increase will have a different range. The increase will now range from $10 to $20 per month ($120 - $240 per year).

On the other hand, you have the uglier change, the grey portion which covers 4% or 534 FEMA flood policies in the state. This is the uglier change because the increase will be more than $20 per month (>$240 per year).

Now, both of these will only impact a small amount compared to the good and the bad changes however they pack most of the punch. This increase can easily get you to that $2000 mark on your premiums or even more once the Risk Rating 2.0 arrives.

You can see the full graph of these changes below:

The Flood Insurance Guru | Oklahoma Flood Insurance: New Federal Flood Insurance Risk Rating 2.0

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 Oklahoma, 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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