All Forum Posts by: Robert Murphy

@Zachary Piatt

Hey, Zachary we have only seen that FHA LOAN are the only one that will not accept the Private flood insurance. Most lenders accept all some smaller lenders just need to be educated on private flood @John Mocker offered some great information about the private flood insurance law BW12 I would suggest you lean on your agent that wrote you the private flood policy and have them call your lender and educate them about the law and the policy. Some lenders like to see the full policy jacket, and some lenders are looking for specific BW12 language on the policy.

I do believe you have a good change of educating your lender sometimes a junior level person or person that really doesn't do a bunch of flood compliance (at your lender) will tell you something that is not true usually if you get ahold of someone with more experience or at your lender and an flood insurance expert you will likely have the lender to accept the policy.

https://www.fdic.gov/news/financial-institution-letters/2019/fil19008.html

I would also ask your lender why specifically they are rejecting the private flood insurance policy. Try to get from they why in specifics then you can address this with the private flood underwriter  (you might need your agent to do this) about why the policy is being rejected. Good luck

@ Jason Crowe here is a link that explains the flood vening for areas in a AE flood zone, Brake away walls are required in a VE flood zone.

https://www.fema.gov/media-library-data/1585162441620-bd1b5b0d5cf34eda30d6363c63290d9a/FEMATB1_508_031320_rev.508.pdf

AS for the lenders requirements to have flood insurance coverage; this is because any lender that gets government funds to offer a loan are instructed by the federal Law to mandate any structure that is in the high risk flood zone (flood zone that requires flood insurance) to purchase a flood insurance policy.

Every lender for Every loan pull what is called a Flood zone determination (FZD) which will tell the lender if the property is or is not in the high risk flood zone (Typically a AE or VE). AS with anything thing there are some companies that pull these FZD that are better then others some have details about the structures and some do not have much information at all.

AS far as the lender requiring coverage on the different structures they will follow the FEMA guidelines as to what it a structure and that guideline is very loose. It is basically two rigid walls, foundation (and dirt ground is considered foundation) and a roof. I have had some lenders require coverage on Lean To (those sheds that block the wind for horses) which is ridiculous if you ask me but I have to write a policy for them to get the loan.

The government policy will allow you to take 10% of your home coverage to cover a detached garage (if and only if it is just a garage), if you have a living area above it like you described with the government policy you will need to have its own policy.  Some "private flood insurance" policies google the term "private flood insurance" you can add on Appurtenant structures to your home policy which can be used for any other structures on the parcel. It is a good idea to ask your lender how much they want on each structure. 
your flood nerd Robert

@Dawn Young sounds like you have some great experience with flood insurance, google "Private flood insurance" skip the ads and you can find out if you can get a private flood policy to save money. The NFIP or government ment policy some call it the FEMA policy can get a bit pricey and they won't let you out of the policy early so you will need to switch on your renewal date. If you are working with a flood insurance expert they will shop all the options in your area to make sure you are getting the best coverage at the best rate. A note on the FEMA "100 year flood" this is so confusing they mean in the significant event of flooding this is how high the waters could go. It doesn't mean that if you had a flood in the past 10 years that you are safe for 90 years unfortunately mother nature could care less what we think and when she is going to pound a area with water that is what will happen. And if an area had a recent flood the chances of that area flooding again within the next 30 years has increase unless the community did some serious flood mitigation (in the form of DAMS, hills, canales and other water diverting attempts. Best example I can think if is that scene in Original Terminator where they were racing through California's flood mitigation. Ok now you know how old I am.Your flood nerd

@ Jonathan Bombaci you are absolutely correct that FEMA is constantly updating their maps (they also have maps that are more then 40 years old and haven't kept up with the development so there could be areas that are at risk of flooding and the maps just haven't caught up. This is what is happening in WA. below is a heat map of the age of the FEMA maps.

@Wayne Brooks good suggestion on getting a surveyor to do a Elevation certificate company that I find that does it the best is Massive Cert they are the best price and are one of the few that actually fill out the document correctly for an insurance agent to work with. I spend much of my day calling surveyors to correct their work. FEMA is very slow once you appeal for a LOMA Letter of Map amendment which could get your property out of the flood zone that makes the lender require coverage. This doesn't remove the risk just the requirement of the lender to force the borrower to get flood insurance and back to the eariler post if you do get a LOMA we can write for you the PRP (Prefered Rate Policy) that get you coverae but at a lower rate. I suggest to many of my clients if they are wanting to see if the property qualifies for the LOMA is to figure out what the current Base Flood Elevation is (BFE) you can use this link to see.

Using the map that @Joe Muchel to explain the BFE will be the number that is represented in this way.

So in this example @Joe Muchel property is likely sitting at 280 ft BFE then I suggest you use this website (https://whatismyelevation.com/) and a smartphone. Go to the lowest place outside the home/structure where the land touches the foundation and set your phone on the groud when you are on this site. It should give you an idea of where the Elevation is. So if Joe's Lowest Adjacent grade (LAG) is above the BFE for 280 say 281 then he would have a good change of getting the desired LOMA if his (LAG) is under 280 like 279 then FEMA will likely deney the LOMA. Let me know if this work! Your flood nerd Robert

@Joe Muchel if your property recently got put into a flood map: AE flood zone I would strongly recommend that you take advantage of the government subsidy that you can get when a property is moved from a flood zone X to an AE. You see the government policy allows you to get coverage at the X flood zone rate (this is called the Prefered Rate Policy) IF you buy the policy within a calendar year of the map change. Washington State had a really large map change 6/19/2020 where 22,529 properties were moved into a flood zone and one more coming for king count on 8/19/20 where another 20,712 properties will be moved into a high risk flood zone.

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The beauty about buying the government policy within a calendar year of the map change you see significant savings and if you are working with a flood insurance expert you can transfer the policy to a new owner and they too can benefit from the savings. 

You can also look for a private flood policy but I don't think you will get the same subsidized policy the private market is best for those people that have properties that were already in the Ae flood zone (also called the high risk flood zone). For now I would recommend that you take advantage of the heavy subsidy and then when it starts getting more expensive shop out to the private flood market. You can search google "private flood insurance" skip the ads.

Your flood nerd 

Hi, @Kerrel Gomes I would suggest you do a google search for "cheap flood insurance" or "Private flood insurance" or "Lloyds of london flood insurance" you can shop it yourself or find a broker that shop all the options that are available for your area. You should also see if you can get a hold of the prior owner's Declaration page as well as an Elevation Certificate if they have it. Sometimes if the property as built after the community entered into the flood program and was built after 1973 you can use the "built in compliance" also if you get ahold of the current owners DECLARATION page they might be getting subsidized rate if they bought the flood policy within a calendar year of the flood zone map change which could be transferred to a new owner but you have to work with an flood expert to make sure it is done correctly.

@ Ryan Letzeiser sounds like you really know your stuff. There are something like 50 syndicate (lloyds of london) that write flood insurance policies in the US so there are a bunch of options. There are also other compaies like HTC, Lexingotn, Swiss RE, Palamar, Zurch and so many more coming on line every day. Neptune, Aon, Assurant are all differnt Lloyds syndicates. Crestway and flood guru are brokers. 

Your flood nerd. 

Hi Dawn Young great idea to search for private flood insurance I would add if you googled "Lloyds of London flood insurance" or "Private flood Insurance" Or "cheap flood insurance" you will see a bunch of options (i suggest you skip over the ads) then look for a company that will shop all the "private flood insurance" options that are avaliable for your area. 

Your flood nerd Robert

@ Jayson Robinson - Yes, i specialize ONLY in flood insurance.

yes Neptune is a Lloyds of London Syndicate and is a decent policy their price is great. There are rumors that they sometimes will drastically increase the premium the second year but we have only seen that happen on a few policies. For the most part Neptune is easy to quote with and their prices are good. If your premium does drasticly increase you can always reshop the private flood market more and more policies are comming on line each day. 

YOur flood nerd Robert