Flood insurance

This section started as a result of the passage of the Biggert-Waters Act leading to the new 2014 Act which rolled back the impact of most of that legislation. It has now been updated, but I am leaving some of the original posts up.

Flood Insurance Changes Coming Oct 1, 2021
Changes are coming to the flood insurance policy sector taking effect October 1st on new policies and April 1, 2022 on any outstanding renewal policies.

Marblehead to vote on new flood maps 
Becky Curran, Town Planner, has put together this FAQ about the proposal. Note that this action is to approve the maps. The FAQ clearly explains the separate provisions, which affect flood insurance, in the new Act passed recently to overhaul Biggert-Waters.

Widespread flooding hits the UK: a different approach to flood insurance
With the whole of England under flood warning, this post looks at the UK approach to flood insurance. Flood is covered under standard homeowners policies, while a new reinsurer, Flood Re, is being set up to cover high risk properties.

To summarize my previous posts on this subject:
– only a small percentage of homes in flood zones carry insurance
– the NFIP has worked well with the exception of major catastrophes
– Congress passed the Biggert-Waters Act without understanding the consequences
– FEMA was supposed to complete an affordability study before implementing new rates, but didn’t
– an independent study suggests that FEMA “used a mapping method fit for the Pacific coast, where the wave periods are much longer and the beaches are straighter, instead of developing a correct approach for New England.”

The facts
While waiting to hear whether Congress will take up a bill to delay the implementation of the new flood insurance premiums they voted into law before they understood the consequences ( telling the National Flood Insurance Program, NFIP, which is losing money, to end subsidies and go to full actuarial rates, results in premiums going up. Apparently nobody in Congress took any economics courses in college and this has come as a surprise to them – or maybe it was just because they don’t read Bills before voting on them), I have been digging into the history of the NFIP. In particular I have looked at the record of Massachusetts as a whole, by County and by Town.

Two things to bear in mind are that flood damage is not covered under a standard homeowner policy and that flooding occurs throughout the country, not just in coastal areas.

Andrew Oliver is a Realtor with Sagan Harborside Sotheby’s International Realty in Marblehead, MA.

Sotheby’s International Realty® is a registered trademark licensed to Sotheby’s International Realty 
Affiliates LLC. Each Office Is Independently Owned and Operated.

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