Integrated Insurance Home Owner Awareness - FEMA Flood Insurance Update!

"I hate it more than anything on the face of the Earth," said Teasel of Fair Haven.

He pays more than $1,000 a year for flood insurance coverage he insists he doesn't need for two homes on canals of Lake St. Clair. This really is no laughing matter.

Lake levels are still down all over the Great Lakes region, even with all the precipitation in the last couple years, and premiums are up for the mandatory insurance for holders of federally backed mortgages in designated flood zones.

With the Great Lakes at low levels, many Michiganders, including U.S. Rep. Candice Miller, are up in arms, saying they believe they're paying for billions of losses on the gulf coast and demanding an end to the National Flood Insurance Program.

FEMA tries to balance flood insurance rates - FEMA Fact Sheet October 2014

Effective rate changes are for April 1st 2015 - Federal Insurance and Mitigation Administration

The National Flood Insurance Program (NFIP) is in the process of implementing Congressionally mandated reforms required by the Homeowner Flood Insurance Affordability Act of 2014 (HFIAA) that repeal and modify the Biggert-Waters Flood Insurance Reform Act of 2012 (Biggert-Waters).

The new law slows down some flood insurance rate increases and offers relief to some policyholders who experienced steep flood insurance premium increases in 2013 and early 2014. Flood insurance rates and other charges will be revised for new or existing policies beginning on April 1, 2015.

In addition to insurance rates, other changes resulting from Biggert-Waters and HFIAA will be implemented that will affect the total amount a policyholder pays for a flood insurance policy.

Highlights of some of the changes taking place in April 2015

An increase in the Reserve Fund Assessment, the implementation of an annual surcharge on all new and renewed policies
An additional deductible option
An increase in the Federal Policy Fee
Rate increases for most policies

Ten major changes in flood insurance reform

Implementing annual rate changes that set rates using rate-increase limitations set by HFIAA for individual premiums and rate classes.
Limiting increases for individual premiums to 18 percent of premium.
Limiting increases for average rate classes to 15 percent.
Mandatory increases for certain subsidized policyholders under Biggert-Waters and HFIAA.
Increasing the Reserve Fund assessments required by Biggert-Waters.
Implementing annual surcharges required by HFIAA.
Guidance on substantially damaged and substantially improved structures, and additional rating guidance on buildings constructed before their communities’ first Flood Insurance Rate Maps (FIRMs) became effective (known as pre-FIRM structures).
Implementing a new procedure for properties newly mapped into the Special Flood Hazard Area (SFHA) and existing Preferred Risk Policy Eligibility Extension (PRP EE)A cost-saving flood insurance coverage option for property owners whose buildings were newly mapped into an SFHA.
The premiums will be the same as the PRP, which offers low-cost flood insurance to owners and tenants of eligible residential and non-residential buildings located in moderate- to low-risk areas for the first year (calculated before fees and assessments) to comply with provisions of HFIAA.
Reformulating expense loading on premiums, reducing the expense load on the highest-risk policies as an interim step while investigating expenses on policies as required by Biggert-Waters. The changes will take effect on April 1, 2015.

Additional policy changes for flood insurance

As required by HFIAA, the maximum deductible for a flood insurance policy will increase to $10,000 for single family and two- to four-family dwellings. If used, the deductible must apply to both building and contents. For single-family homes, choosing the maximum deductible will result in up to a 40 percent discount from the base premium. It is important to remember that using the maximum deductible may not be appropriate in every financial circumstance and may not be allowed by lenders to meet mandatory purchase requirements.
The Federal Policy Fee will increase by $1 for most policies other than the PRP, which remains $22. The exception is policies rated using the map change table, which will increase to $45 to ensure the solvency and sustainability of the program.
A new rate table showing annual rate increases of 25 percent will be created for pre-FIRM buildings that have been substantially damaged or improved. However, repairs made to these structures typically must meet current building codes and, therefore, will usually receive a better rate using post-FIRM rate tables.
In most cases, average rate increases for each rating class are capped at 15 percent; the annual surcharge and Federal Policy Fee are not included in the rate calculation and could result in the total amount charged a policyholder increasing by more than 18 percent. For full explanations and guidance, see WYO Bulletin (W-14053) and the Flood Insurance Manual. Read the latest WYO Bulletins for.

Just because a flood hasn't happened in decades doesn't mean there is no risk. Chances of Great Lakes flooding may be slim in 2011, but that could change with a few years of heavy snow and rain in the lakes' vast drainage basin.

"Flooding is the most common and costly natural disaster in our country, and homeowners insurance typically does not cover damage or losses," said FEMA spokesman Brad Carroll. "Flood insurance can be so crucial."

If you are wondering where to go from here, the first thing you should do is call Integrated Insurance Agency.

Integrated Insurance Agency associates have all the latest information from multiple carriers to give you the most extensive coverage at the best rates. To learn more please contact your Integrated Insurance agent at 888-823-1342, or if you are near one of our many locations: Brighton, Port Huron, Novi, Marlette or St. Clair Shores, come in and see us.

“If you are not using Integrated, you are paying too much for insurance.”