All Forum Posts by: Robert Murphy

@Jena Richards thanks. I just sent you an email. cost looks good. we can keep digging to make sure that is the best we can do for your flood. 

On October 1, 2021 the National Flood Insurance Program (NFIP) is changing things up. Since their inception 50 years ago they have been the only option for properties flood insurance. That's not true today with our growing private flood insurance markets. However, this post is about government policy.

The government is getting rid of the heavily subsidized Prefered Risk Policies (PRP) these are policies that were issued in X, X500, B or C flood zones, and the government historically has heavily subsidized these policies making the premium more favorable for the smart few that bought these policies. We are talking about a flood policy that is between $500 - $750 and is about 80% of the actual policies that the NFIP has on their books.

Warning - If you want one .....get it before October 1. There is a 30-day wait so really you should get it now.

The reason this would make so much sense to buy one now is you can grab a policy for $500 - $700 and FEMA. Risk Rating 2.0 will put this policy on what they call a "glide path" for the increases to the premium it will increase at the cap of 18% year over year until it reaches what FEMA considers the full risk premium. So an example is if the full risk for your premium is $2,500 you will have a few years at the 18% increase tell it gets to the full risk saving you money over the long hall. Be warned if you forget to pay just one year this subsidized policy is gone. So Even if your lender isn't requiring coverage however your investment buildings are close to any type of water or FEMA flood map. Get the policy.

NFIP 2.0 - What’s Changing with National Flood Insurance and Why You Should Care.

It’s been a long time coming, but reform to the National Flood Insurance Program (NFIP) is on the way.

Risk Rating 2.0 (that’s how we Flood Nerd-types refer to the reform) isn’t a complete government policy re-boot and it’s going to change the flood insurance market. How the change affects homeowners, business owners, and condo associations will vary depending on your property location and your flood policy.

What’s Changing?

There are major changes and small changes coming with FEMA 2.0. Here's a rundown on what I think are the most important changes.

1) One of the biggest changes to the NFIP will be how they rate policies. For too many years they overcharged half of their customers and undercharged the other half. It seemed as if no one really paid the right amount. The NFIP has relied solely on maps and elevation certificates, however, the new methodology places homes in market “baskets”. The baskets will contain structures with similar property and policy coverage characteristics for that area. Rating will begin to resemble how risk is assessed for other types of insurance. 

2) FEMA enters the technology age. The private flood insurance market has used high-tech to better understand the risk of flooding. The NFIP will now employ this same technology. NFIP was relying on outdated maps for rates in the past some of the maps were more then 50 years old.  

3) Homeowners in Washington, Oregon, California, Alaska, and Hawaii pay attention! FEMA 2.0 will factor in the risk of a tsunami into the new coastal rates. FEMA 2.0 will exclude tsunami risk from the rates for a property that is 20 miles inland from the Pacific Ocean or in California ZIP codes 92647, 92648, and 92649. They will also exclude tsunami risk in the Atlantic Ocean.

4) VE flood zones will be added to the Great Lakes properties. They can be impacted by seiche flooding. This is a standing wall of water or a huge wave that is caused by strong winds and a rapid change in atmospheric pressure.

5) Replacement Cost Value. One of the advantages of private flood insurance is the ability to insure for the replacement cost. FEMA 2.0 will use a replacement cost value to calculate premiums, but they will still limit you to $250,000 in coverage.

6) FEMA 2.0 will give you credit for individual property mitigation. Elevating the building on posts, piles, or piers can save you money. Move the building machinery and equipment up off the lowest floor and you'll get a break too. Flood openings, when done in accordance with FEMA rules will save you money but they must be certified by FEMA to earn mitigation credits.

7) Prior Claim will not be considered until you have a loss after October 1 2021. FEMA 2.0 is going to wipe the slate clean. But under FEMA 2.0 the surcharge incurred for a claim within the last 20 years only applies to claims filed after FEMA 2.0 goes into effect. Which is October 1 this year.

Under FEMA 2.0, flood policies will not be rated on a flood zone map. They will be rated on:

• geographic location
• property characteristics
• policy characteristics

@Michael Sellers I would suggest you google "lloyds of London flood insurance". You will get the best rates with them if you don't have an Elevation Certificate. 

Here is the guildlines for getting a L0MA as outlined by FEMA

https://hazards.fema.gov/femaportal/wps/portal/!ut/p/z1/hY9Bb8IwDIV_C4ce05gVEOwWAQIxtFLBRJcLCsNNO6VJlYZW2q8nKgjtwJhvfv78nk05TSnXoimkcIXRQvn-k48O681ysYzfIB6zwQyS6XS3-nif92Exovv_AO7H8Ecx8Pu8Q-4OEE_mkAyi_mY7ZC-QRDfgiceKcqnM8Xou08doLCm3mKFFG56tl3Pnqvo1gADatg0zLEUoTRPAVy60RJIpY07kx2gkJ6wLqbv3idGq8JJC59CSUlTkyj-KyU3taPrbnVZlCt9D1axZr3cBIY-m6Q!!/dz/d5/L2dBISEvZ0FBIS9nQSEh/p0/IZ7_LPHGHOK0O0FS90QC3D3QM53020=CZ6_LPHGHOK0O8A4D0QCCTJUNE10G6=MOA=Ejavax.portlet.as!=ContentData!QCPresourcesQCPwhatiseloma.htm==/#Z7_LPHGHOK0O0FS90QC3D3QM53020

Hi @Shawn Ziegaus, Have you tried shopping your flood insurance on the private flood insurance market?

I suggest you google exact term (private flood insurance) or (Lloyds of London flood insurance).

Note: Skip over the ads and look for an agent that will shop all options (including the NFIP or government option).

We do a free audit of someone's current policy (and oftentimes find errors) as most agents don't specifically deal with flood insurance and are not experts at how to get the best premium for their clients. 

Moving the policy to the private flood insurance market you might be able to save money.

AS for getting a LOMA

Getting a LOMA (Letter of Map amendment) takes a very long time.

There is a trend that the government (FEMA) is not removing propeiees as readily as they did a few years ago.

We have also seen that properties are removed and then put back the very next year. 

VERY frustrating. 

Anyway there are a few things I can offer to you for how to see if your home will qualify for the LOMA. 

1) First look up your property in this link

https://hazards-fema.maps.arcgis.com/apps/webappviewer/index.html?id=8b0adb51996444d4879338b5529aa9cd

2) Put in your property address.

3) Then on the Right hand side there is a menu tool click on it to twarrol it down and look for the LOMA  click it on. 

What this will do is turn on all the properties that have applied the address. 

If there are any LOMA's a Pink/Purpleish DOT and date will show up.

The Light blue is the Flood zone. 

4) Click on the DOT and download and you will see the pop up of what the result is.

5) Look for the area that says OUTCOME and look to see if it says "Removed" or "NOT removed" 

NOTE: you will have to be patient the site is a bit slow but if you wait for it to develop you will be able to discover a lot about your area, so be patient. 

My thinking is that if properties have had success getting a LOMA around your property then there is a good chance you might be able to get one as well.

If you don't see any then well you might not be able to get one. 

So the private flood insurance market might be a better solution.

There are some "tools" you will need to get the government to look at your property. You will need to get what is called an Elevation Certificate(EC) (needs to be done by a government approved surveyor).

These can cost about $500 - $800 and most of the time I have to help the surveyor. I can help point you to get one if you want. You can also google (your area and Elevation Certificate). 

If your property is in an just an A flood zone (like in the photo) there are is a different way to go about getting the EC if so put that in this thread and I will try to explain what you can do in this instance. 

Good luck. 

Your Flood nerd Robert

@ Vinci S I can help you or you can do a google search for "private flood insurance". Let me know. 

Your flood Nerd Robert

Hi @ Jason Crowe I did send you a personal note per your request on your property. I also want to make sure that any others in our community that might be in the same position can benefit from this thread. 

So for a structure that has a living area over a garage we can do a few things with ultimately we are wanting to take the "rating floor" out of the mix (with the government option) you would do this with the venting that I spoke about above in. Basically in your area the Base flood elevation(BFE)  is 7ft (BFE is how high the core of engineers say the water will go based off of sea level being 0). So lets say that your slab of the garage is at 5ft and your living area is 10 feet above that so 15ft. By having the garage properly vented and ONLY used for parking and Storage then your rating floor would be the 15ft so +8 meaning that your structure living area is 8 feet higher then the BFE and this would make your government rate about $500 for a secondary home of if this was your primary it might be $350 it is huge savings. 

The rates I am seeing if the garage is not property vented is  $6,778

Please note that this is speculation because I don't know exactly where the elevation is but I am optimistic that your living floor is above 7 feet. 
I did send you an option that was with the private market as well that was around $515 I am guessing this is because the private market (Lloyds) sees the risk lower because there is a garage under the living area. Let me know what you think and if anyone else has any questions. 
YOur flood nerd Robert

@ Jason Crowe if you property vent the garage part it should take that floor out of the rating consideration. Basically the NFIP would rate at the next higher floor (which is "I assume" the unit.

Note that the square inches of the vents needs to be at or more then the square feet of the garage. So if your garage is 1000 squre feet then you need 1000 square inches of holes to take the bottom floor (your garage) off the rating consideration.

There are also a few more thing to conder when putting the holes in you need to make sure they a no more than 1 foot up (this might change per your area so you need to refer to the document here for guidelines https://www.fema.gov/media-library-data/1585162441620-bd1b5b0d5cf34eda30d6363c63290d9a/FEMATB1_508_031320_rev.508.pdf

So then the question is do you get a new Elevation certificate (EC) or can you just show photos that you have updated the structure. Ideally the updated EC would be the cleanest way if you were working with your local agent that doesn't really understand flood insurance. But if you are working with a flood insurance expert you can provide. photos of all the openings with a measuring tape showing how large the holes are and how high they are from the outside ground.

If you want to get really fancy you could put in engineered openings.

https://smartvent.com/products?gclid=EAIaIQobChMIw4HGkaPB6gIVD77ACh1rLwaNEAAYASAAEgKHIvD_BwE

This graphic explains why Vents are considered so important for flood mitigation​

@Zachary Piatt that is fantactic news Bud! Lender don't understand flood insruance and honetly few people really do. so if you have any quesitons ask a flood nerd or start a thead. The best quote I have from the Documentry Chicken people this was from a old timer that was a chicken expert. The quote is "There are 1000 of people that know more then I do about chickens (incert "flood insurance") but, there are millions of people that don't know a darn thing about a chicken (Incert "flood insurance") I guess we can all be NERDS in one form or the other. I happen to really like chickens too. Glad I could help. 

Your flood (and Chicken) nerd Robert