Hun­dreds could save on flood in­sur­ance

The Covington News - - Front page - GABRIEL KHOULI gkhouli@cov­news.com

Floods aren’t a com­mon oc­cur­rence these days in drought-stricken Ge­or­gia, but they still hap­pen, like the 2009 flood, and cer­tain home­own­ers still have to worry about flood in­sur­ance.

More than 1,000 New­ton County res­i­dents are re­quired to buy ex­tra in­sur­ance be­cause they own homes or other build­ings that fall in a fed­er­ally-des­ig­nated flood haz­ard area, but new, more pre­cise map­ping could re­duce the fi­nan­cial burden for hun­dreds of home­own­ers in 2013.

The new flood­plain map­ping won’t go into ef­fect un­til late 2013, af­ter mul­ti­ple pub­lic meet­ings, but when it does, it could save some build­ing own­ers hun­dreds or even thou­sands of dol­lars in flood in­sur­ance pay­ments.

Build­ing own­ers who aren’t lo­cated in a fed­er­ally-des­ig­nated flood­plain don’t have to buy flood in- surance at all, and even if they do buy in­sur­ance, their costs are sig­nif­i­cantly lower than they those who live in a flood­plain.

Scott Hub­bard, a State Farm in­sur­ance agent, said there are too many fac­tors to give a gen­eral num­ber of how much flood in­sur­ance rates could be re­duced in New­ton County, but he said the ma­jor­ity of rates he sees are around $500, though he’s seen some as high as $2,000 to $3,000. The pre­mi­ums are set by the Fed­eral Emer­gency Man­age­ment Agency (FEMA) and aren’t ne­go­tiable, Hub­bard said.

“(The pre­mium) will be much dif­fer­ent if you’re liv­ing in $600,000 house ver­sus a $60,000 house. Even neigh­bors liv­ing 500 yards apart could have dras­ti­cally dif­fer­ent pre­mi­ums; there are so many vari­ables that

go into cal­cu­lat­ing pre­mi­ums,” Hub­bard said. “Where you are along the Al­covy River is go­ing to change how much you pay from one area to the next…(Leav­ing the flood­plain) could lead to a sav­ings of a cou­ple of hun­dred dol­lars or a cou­ple thou­sand dol­lars. It all de­pends on where you live.”

Ac­cord­ing to a pre­lim­i­nary anal­y­sis by Ernie Smith, a tech­ni­cian with the New­ton County Ge­o­graphic In­for­ma­tion Sys­tems, a net to­tal of 445 prop­er­ties with build­ings would be re­moved from New­ton County’s var­i­ous flood­plains when the map change takes ef­fect.

Un­der the cur­rent flood­plain map, which was cre­ated in 2007, 1,094 parcels with build­ings – homes or other struc­tures – fall in the des­ig­nated flood­ing bound­ary; that num­ber would be re­duced to 649 struc­tures un­der the re­vised, pre­lim­i­nary flood bound­ary cre­ated this year.

While the net to­tal of build­ings will be much lower, there are some struc­tures out­side the cur­rent bound­ary that will soon find them­selves within a flood­plain, mean­ing some own­ers will see ex­tra costs.

To see if you’ve been af­fected, check out the map at map.geor­giad­firm.com and drill down to New­ton County. Users have a va­ri­ety of tools at their dis­posal, but the most use­ful ones will most likely be the ad­dress search and the ef­fec­tive flood zones and pre­lim­i­nary flood zones tools. The ef­fec­tive flood zones are the ones cur­rently in ef­fect, while the pre­lim­i­nary data shows what the zones would be once the new map is ap­proved.

Users should be able to sim­ply type in their ad­dress and see whether their build­ing has been af­fected by the change, or they can man­u­ally scroll to any area and see if it has been af­fected us­ing the other tools. The web­site can be prone to glitches and any changes you want to make to the map can some­times take a while to show up. Why flood in­sur­ance is man­dated?

First of all, the vast ma­jor­ity of home­owner’s in­sur­ance poli­cies don’t cover flood dam­age, so if a build­ing owner wants fi­nan­cial pro­tec­tion against flood­ing, he has to buy flood in­sur­ance.

Ac­cord­ing to FEMA, floods are the most com­mon nat­u­ral dis­as­ter in the U.S. and caused nearly $2.7 bil­lion in dam­age from 2001 to 2010. In a high-risk flood area – the kind of area in which FEMA re­quires a build­ing owner to buy flood in­sur­ance – there is a 26 per­cent chance of ex­pe­ri­enc­ing a flood dur­ing the life of a 30-year mort­gage.

Fed­eral law re­quires build­ing own­ers in high­risk flood ar­eas to have flood in­sur­ance, but it’s the mort­gage lenders that are tasked with en­sur­ing those own­ers ac­tu­ally do have in­sur­ance, ac­cord­ing to Levi Bai­ley, a loan of­fi­cer with New­ton Fed­eral Bank.

If a build­ing owner re­fuses to get in­sur­ance, the banks can put forced placed cov­er­age on a build­ing and add the in­sur­ance pay­ments to a owner’s loan bal­ance, Bai­ley said; how­ever, the forced placed cov­er­age gen­er­ally only cov­ers the bank’s in­vest­ment, not the home­owner’s pos­ses­sions.

Own­ers gen­er­ally have 45 days to pur­chase flood in­sur­ance from the time they are no­ti­fied that their build­ing falls within a flood­plain.

“A lot of the time peo­ple don’t un­der­stand that it’s not the banks re­quir­ing flood in­sur­ance, it’s the fed­eral gov­ern­ment per their laws” Bai­ley said.

Not all mort­gage lenders are dili­gent about re­quir­ing bor­row­ers to have flood in­sur­ance. In the case of wide­spread nat­u­ral dis­as­ters, the gov­ern­ment may de­clare the area a dis­as­ter emer­gency area, in which case fed­eral funds can then be used to help re­pair dam­age. While this may be good for the in­di­vid­ual prop­erty owner, it also means the pub­lic is es­sen­tially pro­vid­ing in­sur­ance free of charge through their tax dol­lars.

On the flip side, even if a home­owner does not fall within a flood­plain, they are still strongly con­sid­ered to buy flood in­sur­ance if there is a pos­si­bil­ity their prop­erty could ever be dam­aged by a flood. Ac­cord­ing to FEMA, build­ing poli­cies start at $20,000 and go up to $250,000, while pos­ses­sions cov­er­age starts at $8,000 and goes up to $100,000.

Safe within a flood­plain

There are some cir­cum­stances un­der which a build­ing owner in a flood­plain would not have to have flood in­sur­ance. If the owner can prove that her build­ing is not in dan­ger of be­ing dam­aged un­der flood­ing con­di­tions – be­cause of par­tic­u­larly high el­e­va­tion or other fac­tors – then she can re­ceive a let­ter of map amend­ment, or LOMA.

The process re­quires the owner to have a study done and to send the find­ings along with an ap­pli­ca­tion to FEMA and can cost sev­eral hun­dred dol­lars. This process has to be done ev­ery time the maps are re­drawn, Bai­ley said. Bet­ter data, safer pub­lic

For Smith, im­proved flood­plain map­ping is a per­fect ex­am­ple of how the in­cred­i­bly pow­er­ful tools at the Ge­o­graphic In­for­ma­tion Sys­tems depart­ment can help peo­ple in ev­ery day life.

As to­pog­ra­phy-map­ping soft­ware im­proves, of­fi­cials’ abil­ity to ac­cu­rately pre­dict events like floods will also im­prove.

Smith said the pre­lim­i­nary maps are a large im­prove­ment over the 2007 ver­sions. The county had aerial map­ping done ear­lier this year us­ing Light De­tec­tion And Rang­ing (LiDAR) tech­nol­ogy, which is able to ac­cu­rately map land’s con­tours.

Nor­mally, the county would have waited a cou­ple more years be­fore FEMA would have agreed to use the newly-col­lected data to up­date the maps. How­ever, given the flood­ing that oc­curred in New­ton County in 2009, Smith and New­ton County of­fi­cials were able to suc­cess­fully lobby FEMA for New­ton County to get moved up in the process.

Many other com­mu­ni­ties aren’t will­ing to in­vest money into such map­ping pro­grams, and that in­vest­ment paid off. Ac­cord­ing to a pre­vi­ous story, the New­ton County Board of Com­mis­sion­ers ap­proved spend­ing $20,000 for the aerial map­ping, while the city of Cov­ing­ton and New­ton County Wa­ter and Sew­er­age Author­ity spent $15,000 a piece.

Af­ter that, FEMA took over the rest of the cost to up­date the flood­plain map­ping; New­ton County only had to pro­vide inkind ser­vices, Smith said.

“If we can re­moved 400 or more struc­tures (from high-risk ar­eas) that’s a lots of sav­ings for peo­ple,” Smith said. “We help pro­tect their and our in­vest­ment and we save the cit­i­zens of New­ton County more than it cost us to do this.

“We take out of equa­tion prop­erty own­ers who, through no fault of own, had to pay more in flood in­sur­ance (than should have to).”

Even for those build­ing own­ers whose prop­er­ties re­mained in a flood­plain, they now have a more ac­cu­rate in­di­ca­tion of which parts of their prop­erty are most likely to be af­fected dur­ing a storm.

Smith said the new flood­plain map was a good ex­am­ple of co­op­er­a­tion at all lev­els of gov­ern­ment, and through the process New­ton County has made more con­nec­tions with state and fed­eral of­fi­cials.

“This is what we an­tic­i­pate the flood in­sur­ance rate map pro­gram to be, fi­nally, to pro­tect peo­ple, not af­flict peo­ple,” Smith said. First pub­lic meet­ing

The first pub­lic meet­ing/train­ing ses­sion re­gard­ing the maps will be for pro­fes­sion­als in­volved in flood map­ping and in­sur­ance, in­clud­ing mort­gage lenders, ca­su­alty in­sur­ance agents and the lo­cal engi­neer­ing community.

The meet­ing is from 8 a.m. to noon, Sept. 20 in the first floor train­ing room in the New­ton County Ad­min­is­tra­tion Build­ing. In ad­di­tion to an updated map, Smith said FEMA may be in the process of chang­ing in­sur­ance rate cal­cu­la­tions. Both a GIS and a FEMA of­fi­cial will be in at­ten­dance.

The county will also have an open house for all New­ton County cit­i­zens, par­tic­u­larly those in or near a flood­plain; the date for the open house will be an­nounced later.

Those who can’t tell, us­ing the on­line map, whether their prop­erty will be af­fected un­der the new map are in­vited to call GIS; Smith said his maps are more de­tailed and he may be able to an­swer ques­tions the on­line map can’t.

File photo /The Cov­ing­ton News

New flood maps will bet­ter help pre­dict flood­ing and may save some home­own­ers money. The scene above oc­cured dur­ing the lo­cal flood of Septem­ber 2009.

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