NFIP Reauthorization, or lack there of…..

Congressional authorization of the National Flood Insurance Program (NFIP) lapsed effective 12:00am March 1, 2010.  This means that until Congress approves reauthorization, new NFIP policies will not be issued or renewed, claims will not be paid, and increased coverage requests will not be processed. This has huge implications on the lending industry and home mortgage/building industry.

So the following actions of the NFIP mapping program will be stopped short of final issuance:

Letters of Final Determination (LFD)
Letters of Map Change:
Letters of Map Amendment (LOMA)
Conditional Letters of Map Amendment (CLOMA)
Letters of Map Revision (LOMR)
Letters of Map Revision based on Fill (LOMR-F)
Conditional Letters of Map Revision (CLOMR)
Conditional Letters of Map Revision based on Fill (CLOMR-F)
Letters of Determination Review (LODR)
Initiation of Appeals Periods
Issuance of Appeal Resolution Letters
Publication of Final Rules in the Federal Register
Publication of notifications in local newspapers
Collection of fees

Please stay tuned and we’ll hopefully have some good news soon…

Finally, a floodplain for all to see

Please check out the article in the December 14, 2009 edition of the Providence Business News regarding the map modernization effort in RI at http://www.floods.org/ace-files/documentlibrary/News_Views/December_2009_News_Views.pdf

Got Something to Say About the NFIP?

FEMA wants to know!

As you may know, the National Flood Insurance Program was established to provide federally backed flood insurance to property owners in communities that agree to manage development in flood hazard areas.  I can attest to the fact that people have a lot to say about the NFIP – good, bad, and ugly! FEMA says:

FEMA is always striving to improve our programs and as part of that effort, we are currently gathering feedback from National Flood Insurance Program stakeholders to gain input on the challenges related to the National Flood Insurance Program (NFIP) and possible solutions to those challenges.

As such, FEMA has initiated a comment period.  Until December 5th, 2009, the public is invited to share their input on all things related to the NFIP.  So, use your voice and be heard! They’ve even made it easy by allowing you to comment directly on FEMA’s Community and Stakeholder Input page.  So, what do you have to say?

 

The Rhode Island Flood Mitigation Association will be hosting Part 2 of their Twilight Seminar Series tomorrow evening 11-20-2009. The topic is a “Brief Intro to Letters of Map Correction”. If you haven’t already registered, please do so ASAP. Contact us ASAP!

Maps are Changing – Sort Of

Many people are already aware that the federal government is nearing the end of a massive project to modernize the Flood Insurance Rate Maps (FIRMs) across the country. (If you’re not aware, you probably haven’t gotten a letter from your lender saying you should have flood insurance.) Here in Rhode Island, two counties (representing 19 of the 39 communities in the state) have already been “modernized.” The remaining 3 counties (if you’re doing the math – 20 communities), have preliminary “modernized” maps available now.

You may have noticed I’m putting the word modernized into quotations. Why? Because for the most part, the new maps do not include any new analysis. There have not been new hydraulic or hydrologic studies performed. In some cases, (like Bristol County) the old maps were simply digitized.

Despite this, it is exceedingly clear that the new maps are very different from the old maps. The new maps include different symbology and are based on a new vertical datum. But this isn’t the most noticeable change, the biggest change comes from the fact that the new maps show the flood hazard zones overlaid onto orthophotos, essentially aerial photographs. Now, structures and roads are clearly visible (at least, they are when the symbology does not obscure the image), making it much easier to identify whether or not a structure is in a special flood hazard area.

This is where it gets interesting (or rather irritating for many property owners). The old maps did not have a base map. If there was not a Special Flood Hazard Zone, there was a big empty white space. The old maps also did not have many identifying roads. So, without detailed elevation data, it was extremely difficult to identify whether or not a structure was located in the regulated floodplain. The new maps remove a lot of this uncertainty.

So…more structures are being identified within the flood hazard area, even though the flood hazard areas didn’t change (in most cases). The complaint becomes “I wasn’t in the floodplain before. If the maps didn’t change, why am I in it now?” This complaint usually arrives via email or a phone call from an angry property owner after they’ve received a letter from their lender requiring them to get flood insurance.

• In most cases, it is simply due to the improved clarity of the maps. The simple fact of the matter is that many property owners were incorrectly excluded from the flood hazard area due to the limitations of reading the maps (if you were fortunate enough never to have incurred flood damages, you may consider this a lucky break that has come to an end).
• In some cases, there were changes to the maps (check at www.riema.ri.gov for the details).
• And in other cases, it is because lenders are being more proactive and more protective.

If you are anywhere close to the flood hazard areas, they want you to prove that you are outside it.

Also, they do have the right to require flood insurance, even if you are not required by law (i.e. you are located in a special flood hazard area).

I hate to be the bearer of bad news, but if your lender is telling that you are in a flood hazard area, the only way to contradict them is to hire a professional to conduct a survey and have an elevation certificate completed for your structure. And chances are, if you’ve always been “kind of close” to the line drawn on the old map, you may find yourself inside the line with the new maps. Maybe its time you find out where your structure is located?

Check out the maps online at the FEMA Map Service Center or contact the NFIP Coordinator for your community to view them. (If you live in Kent, Washington, and Newport County, the preliminary “modernized” maps are available to view in your town or at RIEMA.) And check out www.riema.ri.gov for more information about all things flood related (and more).

Elevation Certificates – Who Has Them?

We frequently get calls from people asking us if we have an elevation certificate on file for their structure.  Let’s clear this up right here.

RIEMA does not have copies of elevation certificates on file.  In fact, for the vast majority of structures, an elevation certificate does not currently exist.  Unless your home or structure is new or substantially improved, the chances are there is no elevation certificate available.

If you fall into the category of “new or substantially improved” check with your local building official, they may have an elevation certificate on file.  Communities are not required to maintain elevation certificates, unless they participate in the Community Rating System (North Kingstown, Middletown, and Narragansett are in CRS).

Property owners who seek out elevation certificates (for insurance purposes or for a Letter of Map Change) would benefit most by contacting a professional land surveyor to assess their property.

Changes to NFIP Today!

For your information:

Changes Effective October 1, 2009

On October 1, 2009, important changes to the National Flood Insurance Program (NFIP) will take effect. There will be an increase in rates, the standard deductibles, and the basic insurance limits. These combined changes will result in an average premium increase of 8 percent. The increases will apply only to policies that are written or renewed after October 1, 2009.

Please read the additional information below which provides more detail and explanation regarding these significant October changes.

The standard deductible of $500 is being discontinued for all properties. The new standard deductible for Post-FIRM (Flood Insurance Rate Map) properties will be $1,000 and Pre-FIRM properties will be $2,000. Owners of Pre-FIRM properties have the option to buy back the $1,000 deductible within 60 days of the renewal of their flood insurance policy. Otherwise, deductibles cannot be reduced midterm unless required by the mortgagee. It is important to remember that there is a 30-day waiting period unless it is a requirement for loan closing. In most cases the deductible is only a fraction of the average flood insurance claim, which can be substantial.

Just as with other lines of insurance with high claim potential, such as wind insurance, it is not unusual for minimum deductibles to increase to foster the soundness of the program. The NFIP’s previous deductibles were in place for almost a decade. In taking inflation into consideration over time, the new standard deductibles being changed effective October 2009 are comparable in value to the previous deductibles when they were first established.

The basic insurance limits are also increasing for all categories of buildings and contents:

• The basic limit for 1-4 Family Dwelling Coverage will increase from $50,000 to $60,000. Additional insurance limits are $190,000 for a total limit of $250,000.
• Other Residential Building Coverage basic limit will increase from $150,000 to $175,000 with additional insurance limits of $75,000 for a total limit of $250,000.
• Non-Residential Building Coverage will increase from $150,000 to $175,000 for the basic limit. Additional insurance limits are $325,000 for a total of $500,000.
• Residential Contents Coverage basic limit will increase from $20,000 to $25,000.  Addition limits are $75,000 for a total insurance limit of $100,000.
• Non-Residential Contents Coverage basic limit will increase from $130,000 to $150,000. Additional insurance limits are $350,000 for a total insurance limit of $500,000.

The emergency program building coverage will remain unchanged. For 1-4 family dwellings this coverage is $35,000* and for other residential and non-residential it is $100,000**. Emergency program contents coverage for residential is $10,000 and nonresidential is $100,000.

* In Alaska, Guam, Hawaii, and U.S. Virgin Islands, the amount available is $50,000

** In Alaska, Guam, Hawaii, and U.S. Virgin Islands, the amount available is $150,000

The premium increases vary by Zone. V Zones are coastal high-velocity zones and will have larger rate increases as a result of the Heinz Center’s Erosion Zone Study, which clearly indicates that current rates significantly underestimate the increasing hazard from steadily eroding coastlines.  The premium increases by zones are as follows:

V Zones

V Zone premiums will increase 10 percent.

A Zones

A Zones, which are non-velocity zones that are primarily riverine zones, will increase by 8 to 10 percent.

• Post-Firm A1-A30 and AE Zones will increase 10 percent.
• Pre-FIRM AE Zones premiums will increase 10 percent to decrease the amount of subsidy in our Pre-FIRM rate.
• AO, AH, AOB, and AHB, which are shallow flooding zones, will have an 8 percent increase in premiums.
• Unnumbered A Zones, which are remote A Zones where elevations have not been determined, will have increase of 10 percent in premiums.
• A99 Zones, which are approved flood mitigation projects, e.g., levees still in the course of construction, and AR Zones will have premium increases of 10 percent.

X Zones and Miscellaneous

• X Zones, which are zones outside the Special Flood Hazard Area, will have an increase of 8 percent for a Standard Risk Policy and no increase in premiums for a Preferred Risk Policy (PRP).
• Mortgage Portfolio Protection Program (MPPP) will have an increase in premiums of 10 percent.

Discontinuance of Paper Flood Insurance Rate Maps

Effective October 1, 2009 FEMA will discontinue the distribution of paper maps.  The paper maps will be replaced with Digital Flood Insurance Rate Maps (DFIRMs). Replacing the paper map products with digital versions is more environmentally friendly and will improve the usability of FEMA’s flood hazard data. It also provides users with a more powerful tool for insurance activities and flood risk management

Why are all of these changes being made?

The NFIP has implemented these changes in order to prepare for future flooding events and to lessen the burden on taxpayers of paying for future flood damage. To ensure the viability of the program it is necessary to have premium levels that correspond to the risk that is being assumed. Most insurance carriers impose annual rate increases on products such as auto insurance, homeowners insurance, etc. and some insurance carriers may refuse coverage to certain high risk prospects, in order to continue to thrive.  However, unlike other forms of insurance, the NFIP, whose policies are sold through various insurance companies and agents, will not refuse to offer coverage as a result of multiple claims or any large sustained loss.  The NFIP continues to provide reasonable rates to people who purchase flood insurance to protect their homes and businesses against the Nation’s number one natural disaster.

For more information about the NFIP, please visit www.FloodSmart.gov. Please feel free to contact us with your questions or concerns at info@femafloodsmart.com.

Why should I renew my flood insurance????

So I recently received a letter in the  mail stating that my flood insurance policy was going to expire soon (even though I live nowhere near a floodplain, yes I do have flood insurance).  You’re probably thinking that this letter must  have come from my insurance company. Well I did get a bill from them of course, but this letter was different from any bill. This letter came from Floodsmart.gov.  Not only did this one page letter go into some great reasons to renew my policy and remain covered, but it provided some really interesting facts on floods.  For example, did you know that in 2008, flood damage in the U.S. exceeded $1.8 billion with an average paid flood insurance claim of $27,947.  According to Floodsmart.gov, nearly 25% of all insurance claims come from moderate-to-low risk areas, such as mine.  Isn’t it time you thought about buying flood insurance?

Hello world!

Welcome to “Demystifying the Demons of Floodplain Management.”

We know floodplain management and the National Flood Insurance Program (NFIP) can be confusing, even to those who deal with floodplains on a daily basis.  We want to help answer all those questions about flood insurance, floodplain mapping, building regulations, and more.

This blog is intended to supplement the information on www.riema.ri.gov and provide a forum for discussion about floodplain related questions.  RIEMA Floodplain Management Program staff intend to blog at least once a week about common questions and misconceptions related to the demons and the intricacies of the National Flood Insurance Program (NFIP).  We will also provide links to useful information from other sources.

As we get blogging, let us know if there is something else you like to see or know about.  We will do our best to answer your questions and comments and make this blog useful for you.

~RIEMA Floodplain Girls