Your Naples Real Estate Expert
  • Home
  • Search Properties
  • Naples Information
  • For You

Do you know about the new flood risk ratings and how they impact flood insurance? Naples Real Estate

9/15/2021

0 Comments

 
Picture
Effective October 1st, there are new changes being implemented that affect flood insurance guidelines and costs. Are you familiar with the high-points of these changes? Matt Nance from Responsive Insurance has provided some a nice, high-level summary to give important insights on this change that is just around the corner.
Changes to Flood Insurance

FEMA is rolling out flood risk rating 2.0. The general concept is that more advanced rating techniques and technology will be combined with updated rating analytics to predict flooding exposure more accurately and thus establish premiums.

Rating 2.0 goes live for new business effective 10/01/2021.

Some key components:
  1. Elevation certificates will no longer be required for flood insurance. FEMA will use their data and technology to establish a rating floor. Elevation certificates MAY still be helpful, however, and data from an available elevation certificate can be used to determine which rating data source produces the most favorable rate.
  2. Replacement cost of the home will now play a part in the premium determination. From what I’ve gathered, the logic is that although two homes may be at the same elevation, distance to coast, flooding exposure, a home with a $2,000,000 replacement value will have a higher cost for finishes and repairs from 1 foot of water in the home than a home with a $250,000 replacement value.
  3. There will be no more “preferred risk zone” for rating purposes. Currently an X zone, for example, is considered preferred risk and the premium is consistent whether an X zone property is located 1 mile from the Gulf of Mexico or 10 miles inland. Going forward with rating 2.0, the distance to coast and other more granular level flooding exposure will be factored into the premium.
  4. Some premiums will go up and some will go down with the new rating methodology. My early assessment (and we are in the very beginning stages of seeing the updated rates) is that our clients with homes nearer the water will likely see some increase to their flood insurance if currently in preferred risk zones. There is an 18% glide path maximum renewal increase cap applied related to the flood rating risk 2.0 update.
  5. It’s important to keep in mind that for flood policies through the National Flood Insurance Program (currently the majority of flood coverage), the  premiums are set by FEMA and, in general, as opposed to other types of insurance, the premium is consistent for NFIP flood coverage, regardless of the servicing company.
  6. Private flood has been gaining traction is recent years due to broader coverage offerings and higher building coverage limits – as two substantial differences. I suspect that trend will continue and may even accelerate as rating 2.0 rolls out.
  7. It appears that under rating 2.0, the benefit of signing over a flood policy to a new owner could play a very important role in regard to mitigating impact of new rates. If you are selling your home or buying a home from someone that had previously purchased flood insurance, this possibility should at least be explored.
​​​
HERE IS ANOTHER RESOURCE PROVIDED BY ANOTHER INSURANCE BROKER
Picture
0 Comments

Your comment will be posted after it is approved.


Leave a Reply.

    NAPLES REAL ESTATE BLOG

    Picture

    Blog CATEGORIES

    All
    Home Improvement
    Naples Happenings
    Naples Information
    Real Estate News
    Tips For Buyers
    Tips For Sellers

    Access Renee Hahn Facebook Posts

    This section will not be visible in live published website. Below are your current settings:


    Current Number Of Columns are = 2

    Expand Posts Area =

    Gap/Space Between Posts = 7px

    Blog Post Style = card

    Use of custom card colors instead of default colors = 1

    Blog Post Card Background Color = current color

    Blog Post Card Shadow Color = current color

    Blog Post Card Border Color = current color

    Publish the website and visit your blog page to see the results

    RSS Feed

CONTACT US
ACCESS MY ACCOUNT
HOME VALUATION

Renee Hahn Logo

Chairman's Platinum & Elite Club
​Top 2% in closed sales volume 
out of 7813 real estate professionals 
​at Naples Area Board of Realtors

239.287.2576
Naples Real Estate Agent Accreditation
Picture
Picture
©2022 All Rights Reserved
​The source of this real property information is the copyrighted and proprietary database compilation of the © 2022 M.L.S. of Naples, Inc. and © 2021 Renee Hahn, Realtor, William Raveis Real Estate. Accuracy of this information is not warranted or guaranteed. Information should be independently verified if any person intends to engage in a transaction in reliance upon it.
​​Privacy Policy
Our Web site Accessibility: We are committed to providing an accessible web site. If you have difficulty accessing content, have difficulty viewing a file on the web site, or notice any accessibility problems, please contact us to specify the nature of the accessibility issue and any assistive technology you use. We will strive to provide the content you need in the format you require.
  • Home
  • Search Properties
  • Naples Information
  • For You