Separate flood insurance coverage is available through the National Flood Insurance Program (NFIP) for any building in the STC region—regardless of the flood zone. (This availability is contingent on local enforcement of floodplain development standards.) Flood insurance for buildings and contents can be purchased from private insurance agents and is generally required as a condition of the mortgage for buildings located in the regulated floodplain (1% annual probability/100-year floodplain mapped by FEMA). The probability of at least one severe flood in this high hazard floodplain during the next 25 years is greater than 1 in 5. Many areas in the floodplain can be expected to flood more frequently.
FEMA is changing the way that flood insurance premiums are calculated. Instead of relying on flood zones and elevations (from Flood Insurance Rate Maps), premiums are now calculated based on the specific features of an individual property, including distance from water, type of flooding, flood frequency, structure foundation type, first floor height, and the structure’s replacement cost value. Although many of these factors are generated by FEMA’s rating engine, it may be beneficial to obtain an Elevation Certificate to more accurately determine the building’s first floor height.
The Risk Rating 2.0 methodology will be used for all NFIP policies beginning on April 1, 2022. It will result in lower premiums for some existing policies and increases for others. Some price increases will be phased in over several years due to a cap on annual premium increases (18% for most primary residences and 25% for other categories). If the cost of your policy increases, ask your insurance agent about the “full-risk premium” so you can anticipate and prepare for future rate increases.
Flood insurance policies are rated based on the flood risk at the building’s location and building characteristics—as well as the type and amount of coverage purchased (building only, contents coverage, deductible, etc.). Because the rating process is complex, there are no simple recommendations that apply in all circumstances. However, it is sometimes possible to make changes to a building that will both mitigate flood risks and lower the cost of flood insurance.
Elevation is the most important rating element, so elevating the first floor above flood levels can reduce the cost of flood insurance, while also protecting it from flood damage. Other opportunities may include elevating utilities or installing flood vents (to reduce pressure on the foundation by allowing water to enter and exit a crawl space or other enclosure). Ask your insurance agent how a proposed mitigation project will change the cost of flood insurance.
The Community Rating System is a program that enables reduced National Flood Insurance Program premiums within communities that go above and beyond minimum floodplain management requirements. Participating municipalities implement and document various floodplain management, flood mitigation, and outreach activities. Nine STC municipalities currently participate at levels that enable 5% or 10% reductions in base premiums for flood insurance policies: