We're already going even deeper into the hurricane season as we go through the sunny days of Summer. It's important to note that when there's rain, there are floods, and when there is a flood, there are also flood map changes on that area.
Today, we'll unpack the upcoming flood insurance rate map changes to Burgaw. This will take effect on June 2nd, 2021 for Pender County.
History of Flood
North Carolina has had a long history of floods. More recently, the Federal Emergency Management Agency (FEMA) is looking to designated funds to acquire flood-prone properties in Pender County. A lot of these major flood incidents are due to the coastal flooding that the state faces and we've seen this happen in 1928 during Hurricane Okeechobee and Hurricane Floyd in 1999 to name a few.
So, let's talk about the good, the bad, and the ugly changes that the new flood map updates will bring to Burgaw and Pender County.
When talking about the good change, we are pointing at the flood map movement that's indicated as "in to out". This change will be coming to 5 properties in the entire Pender County.
Generally, this would mean that 5 properties will be moved out of a high-risk flood zone or the special flood hazard area (SFHA) to a low-risk flood zone. Some people would call this moving from Flood Zone A to Flood Zone X.
Now, if there are going to be good changes, there are also bad changes with this new flood map update. This bad change is the movement from "out to in" and something that about 914 properties will experience.
Out to in refers to properties that are in the low-risk zones moving to high-risk flood zones. This is a bad change because of what will happen after you're moved into the SFHA. This means that you're going to get an increase in your base flood insurance premium with FEMA and even the private market.
It's also expected that your mortgage company will now require you to carry flood insurance for your property when previously, it's something you generally don't think about.
Lastly, we want to talk about the ugly changes coming with this flood map update. This ugly change is when a property is moved "in to in" or being moved into a higher-risk flood zone. Generally, this may put you in Flood Zone AE when previously you're in Flood Zone A.
This change will come to about 1300 properties in Pender County. Such a movement will really cause a drastic increase in flood insurance premiums which can be up to 15%. This movement may also cause some private flood insurance carriers or providers to avoid writing a policy for you due to the flood zone being too high of a risk. The National Flood Insurance Program (NFIP) may also require additional documents like photos and an elevation certificate with the mandatory flood insurance in order for your policy to take effect.
Now, let's talk about how you can prepare for these changes and what the best flood insurance option is for you.
Flood Insurance Options
When it comes to flood insurance options, it's important to note that it won't matter what loan type you have since you can choose to go through either of these options. We have federal flood insurance and private flood insurance. Let's go through each option and understand their differences.
The NFIP Option
Federal flood insurance provided by the Federal Emergency Management Agency (FEMA) through the National Flood Insurance Program (NFIP). Now, it's important to note that you can access this flood insurance option only if you're in a participating community.
The NFIP offers coverage for properties, buildings, or structures of $250,000. When it comes to property coverage, other properties that aren't listed as the main building will have to get a separate policy for those additional buildings. Contents and personal items will have a coverage of $100,000. It's important to note that these coverage amounts are maxed out to those numbers. The NFIP won't also provide additional living expenses, replacement costs, and loss of use with their policy.
If you're looking to buy flood insurance through FEMA, you may have to follow a strict 30-day waiting period before the policy can take effect on your property.
The Private Flood Option
On the other side of the fence, you may go through private insurance companies' flood policies also known as the private flood. Since this is provided by private insurers, you won't have to go through the red tapes that the federal flood insurance may have. Immediately, you can see this on the general waiting period for private flood insurance. The maximum waiting time for private flood is fifteen days this is considering that you're going to have to wait in the first place.
Private flood insurance also doesn't have any coverage limits to the amount they can cover for property and personal items. This means that you can go up to $10,000,000 for the property damage coverage if you'd want to and $1,000,000 on personal items. Now, it's important to note that this is relative to your property's construction which is why it's highly recommended that homeowners with expensive buildings go through the private flood.
Private flood insurance also provides additional coverages like additional living expenses, replacement costs, and loss of use which really protects the way of life policyholder from the aftermath of flooding.
At the end of the day, it's important that we keep our guards up and especially when states like North Carolina can propose a bigger flood threat due to storm runoff, spring thaw, and coastal flooding.
So, if you have any questions on flood map changes, flood insurance, or your flood risks, reach out to us. Remember, we have an educational background in flood mitigation and we want to help protect the value of your property long term. Click the links below to watch our daily flood education videos on YouTube, call us, or get a quote from us so you can get started on your flood insurance purchase today.