Paperwork error may hike flood insurance cost
Some Bellaire residents will temporarily lose their discounts after city fails to file required data with FEMA
Flood insurance policyholders in Bellaire may lose their discounts starting Oct. 1 after a paperwork error.
Some Bellaire residents will lose the discount after the city’s ranking lowered in the National Flood Insurance Program’s Community Rating System because Bellaire officials did not file the required paperwork with FEMA to maintain the discount.
The city’s CRS classification will be downgraded from 7 to 10 until at least April 1, 2022, temporarily eliminating homeowner’s flood insurance discounts of around 15 percent in some parts of Bellaire.
CRS is a voluntary program aimed at recognizing and encouraging community floodplain management activities that exceed the minimum NFIP standards. Discounted flood rates are based on the participating community’s efforts toward mitigating flood damage, strengthening and supporting the insurance aspects of the NFIP through public outreach, and fostering comprehensive floodplain management.
“From the time the city was notified of the problem, staff have been working diligently, and in close coordination with FEMA, on a plan to solve it,” wrote Friedberg in a blog post. According to Friedberg, FEMA has approved fasttracking the city’s reclassification to a 9, which will result in a 5 percent discount across the city beginning in April 2022. FEMA is also allowing the city to further improve the classification back to a 7 or lower by October 2022.
“This at least limits the damage in the near-term, and potentially even puts us in a better position moving forward than where we started,” wrote Friedberg.
For policyholders who renew their flood insurance after April 1 of next year, there possibly will not be any change to their discount. For others, the changes may vary.
FEMA is also implementing major changes to the rating criteria on Oct. 1, called Risk Rating 2.0: Equity in Action. The new rating system considers structure-specific factors, such as probable inland flooding; elevation; historical storm surges; natural surroundings and barriers; cost to rebuild the property; distance to the flooding source; and historical losses.
“This is new, and frankly, the impact of the rates are somewhat unknown on an individual basis,” said Bryan Carroll, Bellaire’s assistant director of development services.
However, discounts under the new criteria will be uniformly applied throughout the community regardless of whether the area is in
a flood zone. Friedberg suggests policyholders may see their premiums go down as a result of the new criteria.
Friedberg says the city staff has taken ownership of the mistake, made organizational changes, and has taken “personnel action.”
“Suffice it to say, no one is happy we find ourselves in this situation, regardless of the ultimate outcome,” wrote Friedberg. “It’s embarrassing, and falls way short of the level of service and professionalism to which the City holds itself, and that we as residents and other stakeholders rightly expect.”