OKay, this is interesting - just received letter from lender that we HAVE to buy and provide proof of flood insurance within 30 days or they will do it for us - AND add nearly $1700 to our loan. Property in question is located about 2 miles from nearest water (river) and has NEVER flooded, much less in the last 500 years (not to menton the last 100 years)...
Talked to the lender (a federal-regulated bank) that says they have no choice re new rules and regulations re floods. Myself, think the insurance companies have great lobbyists - mandate more insurance policies/premiums from those with loans from federally insured banks - spreads the loss from those the insurance companies are now having to pay out...
What do you think?
Do not blame the insurance companies; blame the government. They are the ones that set the rules and decide you can and who must be included in the program.
Now your local government can opt out of the flood program but , of course, there are problems with that too.
I find it funny (not ha-ha type) that the government is spending money on TV commercials telling us to buy flood insurance. As taxpayers we pay for that prgram (part of it) and then we have to pay the ad to entice people to buy it so that more tax dollars can be spend on it. Mad circle!!
Also, unlike what the commercial implys, not everyone can get flood insurance. The community has to sign up for it and then they have to follow the rules imposed, some of which can be expensive and/or a detriment to the town. Only then can individuals within the area buy the gov't insurance.
I can see the need for it on the one hand but on the other I don't feel I should help pay for someone who builds an expensive home next to the river downward of a dam, when an ounce of common sense tells you that it will flood.
I'd be pretty unhappy if I were in the situation of the OP - someone telling me I have no choice but to add on another expense.
However, when we had the remnants of Hurricane Watsisname come thru our area last year a LOT of people who'd never dreamed they would ever be in any danger of flooding found out PDQ the damage water pouring into your home can do. Some homes even had to be condemned - and honestly, this is an area you'd never think would get it.
I'm sure where the OP is will never get a flood like that but as they say, "never say never".
We had that happen around here. It didn't affect me directly, so I didn't pay too much attention. It seems someone re-drew the flood maps and suddenly many many people were now in the zone, and were required to get flood insurance. I think some neighborhoods were able to lobby and got the maps changed, again.
Not much help, I know, just wanted to say you're not alone!
Where I live - we tell everyone - buy flood insurance. It is not that expensive and as the floods in the midwest are proving - you never know.
I live less than 1 mile to the ocean and my back yard is a tidal marsh. Our flood insurance is about $400 per year. We had to have it when we first built our house because 1 corner of our lot was within the 100 year flood plain. A few years later the map was redone and our lot was removed from the flood plain. We kept the insurance because of our hurricane fears. We have wind and hale along with our homeowners (we pay twice in insurance than we do in property taxes) for most hurricane related exposure but feel more comfortable with the additional coverage.
Most homes in our area are built on slab foundations and because of our very high water table most communities have retaining ponds. So even if you are a mile or two away from the coast - you still have the potential for flooding.
The more people who buy into flood insurance - especially in the midwest with all the rivers - the less exposure for anyone person.
Personally - I'm really ticked at the cost of my homeowners insurance. Me and all of my neighbors are having to pay for Katrina. Our rates nearly doubled in 2006. Our area hasn't had a major storm since 2001 and Floyd wasn't all that severe. But our rates keep going up, up and up some more.
Big story on the news in FL. last night. Citizens ins. which is gov't run is now making people in sink hole areas to purchase sink hole ins. and the cost is awful. Most people will not be able to afford this and will have to go without and that is almost as bad as not having wind ins. here in FL. There have been too many claims of late and of course that is why this is happening and I am thinking that flood ins. is also because of the recent floods in quite a few states. We pay for insurance but we are not supposed to put a claim in EVER.
Nuts, I thought that our new Governor, was going to rein in the insurances so that they would not be such crooks. My daughter just told me that all homeowners will go up, because he just allowed an increased in the rates of the homeowners insurances.
Good job Gov.!!!!!!!
Now, I really don't know who is at fault on this one, but last year, they redid the areas of who is and who is not in the flood areas, we were lucky, and we are not, but, nevertheless, I have been paying flood insurance any way. Because of the Hurricanes in this area.
Now if you have I guess big areas of water near you, or rainfalls perhaps is not such a bad idea. Fema only charges 348. a year for flood insurance.
By the way, is not uncommon to have those tables for flood change, I do believe that they change them not every year but they have to reassess them every so often. I imagine that the Mid west is really being looked at, this time because of all the floods.This message has been edited. Last edited by: rker321,
Glad to see so many responses to my post - thanks all!
Have to clarify a few things, though. IF we had even the slightest exposure to a risk from flooding or water, I would have no problem buying and paying for that type of insurance. Even though, like everyone else, I'm not wild about paying insurance, I DO UNDERSTAND the benefits of having it when you need it so that wasn't really the problem.
So what was the problem? Being forced to buy insurance (after years of an existing loan) for an event which has little to NO chance of ever occuring... we don't get hurricanes, tornados or any other natural events that could affect this property with flooding. Have you heard of 100/500 year plans? Well, our area has NEVER been in either - never been flooded in over 500 years - but NOW we have to buy and pay for the same?
Myself, I think it is way for the insurance companies to re-coup some of the money they have been forced to pay out with the historic floods that have happened this year - by forcing more people to buy flood insurance via the leverage they have...
Well, since we have no choice and have to keep our loan in good standing, we now have said insurance for no reason at all that I can see except to raise the insurance companies "bottom line" come annual meeting.
If I thought we could EVER possibly need it in a 100 years, I would have been the first to buy it VOLUNTARILY but wasn't given that choice. So the insurance company now has a lot more money (mine and everyone else's that has been affected by the "re-drawing" of flood maps and regulation of federally-regulated bank loans) - to off-set their losses.
Something is wrong with this picture...
PS. Idaho's annual rainfall is a little less than 12" per year (11.71 to be exact) although we have had a very wet year so we might get up to 15 inches this year! Guess it's going to come in handy to have that flood insurance - when those torrential rains of 2 inches or less come! This message has been edited. Last edited by: Idaho Resident,
Idaho, as usual you have hit the nail on the head. Too bad there isn't any way to let the powers that be know that we know what is going on.
Oh, my. That isn't good news. I have to agree with you, too, IR.
The villa? Its insurance doubled since we first bought it in 2001. I think to make up for the fires.This message has been edited. Last edited by: Charcoalsmom,
One clarification - flood insurance is not sold by traditional insurance agencies. It is more of a fund.
Double check with your bank. If you are not in a either a 100 or 500 year flood plain what is the reasoning they are giving?
I don't understand why you are blaming 'insurance companies'? They cannot force you to buy a policy. The government can force you do things, your lien holder can require it but it is not the mandate of the insurance companies.
I can understand being upset but please be upset at the right people. Have you talked to your bank as to why?
We voluntarily decided to buy flood insurance after a "never gonna happen" 500 year flood happened here, just yards from my home.
We live in drought-stricken Central Texas, but last September a massive rain fall caused severe flooding in our development. When we bought our home in 2006, we inquired about flood insurance because of the proximity to a small creek in our development. Nah, no need, we were told. Many of our neighbors were told the same thing.
When the rains came and caused hundreds of thousands of dollars, actually closer to a million or more, in just our particular neighborhood, folks were outta luck. Only two or three were wise enough to have purchased flood insurance.
Because we are in a drought, the run-off could be catastrophic and the creek could swell far enough to reach our home and flood it.
The way we see it, the $358. it costs to purchase the insurance(about a dollar a day)is for our peace of mind.
The irony: good luck getting flood insurance after the fact. The only reason we got approved is because we have not YET had any flood damage or claims to our home.
Charming and metwo, you are right, private insurance companies do not "push" flood insurance on anyone; instead, mortgage companies use FEMA flood maps to decide whether to require a homeowner to buy flood insurance.
I did my research as soon as I read about changes in the flood insurance requirements for some areas in the whole country, to know if I was about to receive a letter from my lender requiring me to buy flood insurance. I found out that FEMA is reviewing their Flood Maps, changing to a more modern digital mapping technology and software. The maps are based on the 100 and 500-year flood plans, which are calculated by computer models using probability and statistical analysis.
So, of course, as technology evolves, the computer models become more accurate and the maps will change. As a result of the maps review, some areas' flood status changed: some areas were not previously considered to be in a flood zone, but are now, and some areas were previously in a flood zone but are not anymore. Other areas status did not change; where I live, we are still not in a flood zone even after the flood map review.
Most states had their maps reviewed in 2011, that is why lenders are now notifying effected homeowners about their new status regarding flood insurance. Just google "FEMA flood maps revision" and you will find lots of information. On this site, for example, you can check the date of the latest flood map review by state and for a specific city and/or county: FEMA map revision dates
If you want to read about the flood map review process, here are some links to FEMA's site:
FEMA flood maps revision and FEMA flood maps modernization
From those links:
FEMA-Initiated Map Updates
Each year, FEMA initiates studies and restudies of flood hazards in communities across the U.S. for the creation, as well as the revision, of community flood hazard maps. Because of funding constraints, however, FEMA can study or restudy only a limited number of communities each year. As a result, FEMA prioritizes study and restudy needs based on a cost-benefit approach whereby the highest priority is given to studies where development is greatest and where the maps are most outdated.
Flood Map Modernization (Map Mod)
Through Map Mod, FEMA is transforming the Nation's flood maps into more reliable, easier-to-use, and readily available maps.
The Multi-Year Flood Hazard Identification Plan (MHIP) describes the strategy, schedule, and budget developed by FEMA for producing flood hazard data and maps to administer the NFIP. It is a living document that is updated annually through a collaborative process to engage stakeholders.
As part of its commitment to improve the Nation's flood hazard maps and in response to stakeholder feedback, FEMA performed a comprehensive review of Map Mod. This review is referred to as the Mid-Course Adjustment. As a result of the Mid-Course Adjustment, FEMA prioritized funding based on a goal of mapping 90 percent of the Nation's highest-risk areas.
edited to update linkThis message has been edited. Last edited by: noname123,
That is right, your insurance agency will not sell you flood insurance, Fema is the one that deals with flood insurance, and like everyone says, you may not have been in a flood area previously, but now you may be.
They do change those table every so often. I imagine that with the next hurricane they will change ours, but, I already pay for it.
Your bank(mortgage lender) is probably the one that is requiring you to buy flood insurance, if the tables have changed and now you are in a flood area.
Yes, go to the link provided and see your area. The insurances have nothing to do on this one.
Though FEMA publishes the flood tables, the way I understand it, flood insurance is only available to peoople within an area if the local government signs up for the program. If your local governemnt has not signed up you cannot buy the insurance even if you want it.
That really could be a bummer.!!!!! Because the Insurance agencies which we all know are so"honest" they will charge you a fortune for flood insurance.
But is your lender that is requiring you to buy flood insurance.
I had a home equity loan with Wachovia Bank and one day I too received such a letter. What really bothered me the most is that they sent the letter requesting proof of insurance by such and such a date and if no insurance was provided they would then bind coverage for me. Coverage that I obtained was $450.00 per year vs their coverage of $13,000.00 per year.
What really ticked me off is that when they sent the letter the number to call was located on the backside of the letter in fine print after it was explained in spanish. If I didn't flip the page and continue reading I would of thought it was junk mail. I was sent these requests twice a year so I just marked my calendar and if I missed a notice in the mail I began calling to avoid the headache of having a binder placed.
Fortunately, it was one of the driving forces to pay off that loan and rid myself of Wachovia which I didThis message has been edited. Last edited by: Sunny Daze,
If you own your home and there are not any loans on it at all, would a homeowner be notified that the flood plan had changed and that flood insurance was now needed?
I don't believe you would, it would be up to you to check the maps each year.
flboy, the best place to check is to call your county government.
If your mortgage is paid up. No they cannot make you pay any kind of insurance, You are on your own.
I am in that situation, I am not required by anyone to pay any kind of insurance. but my losses will be mine, that is why I pay homeowners and flood insurance.
And yes you will be notified, because we have been twice since we moved here.This message has been edited. Last edited by: rker321,
Really! In Florida, you are notified? So different from other parts of the country. Goes to show so many thing have to be answered locally.
Second thought... did the notice come from your county? Do you both live in the same county?This message has been edited. Last edited by: metwo,
we are required to have flood insurance...and my premium is $2900/yr...through liberty mutual/fema...i don't understand your low premiums...
I put an offer in on a home last year, and a corner of it was in a flood plain, and my flood insurance premium would have added $200/month to my insurance, so as previous poster said, some of your premiums are very reasonable. I was also told by the realtor that I could request that the property be re-assessed to see if it really still needed to be listed as in a flood plain. So as a previous poster said, you could officially request that assessment. I thought it was a lot to add to the cost of purchasing the home, but it was required by the lender.
I wanted to purchase a house, only to find the sellers knowingly did not disclose that it was in flood zone with insurance rates at 100-200 extra per month. Now I want out! I feel I am in the right to demand my deposit and money paid for inspections back. Am I correct?
Flood insurance used to be around $200.00 to $300.00 a year, why is it going up so fast? I don't need any but we did experience the 100 year flood plain just last month with TS Debbie. The arieal view from the county was spot on the water flow. We are building a workshop and at first it was 35ft from the property line. now we know it has to be 60 ft because of this flood plain.
Also Florida has just raised their minimum wind speed from 125 to 140 for buildings too as of Mar,2012.
Do check with the GIS department in your county. DH is trying to straighten a problem out right now. His GIS FEMA maps show only 1 mile from the coast in this county for homeowners needing flood insurance. But the County Building Department just grouped everyone that lives west of a certain HWY close to the coast in that same group. Meaning thousands of homeowners who don't need it now are getting notices.
You need to do some investigating.
Whether You Think You Can Or You Think You Can't..... You're Right - Henry Ford
Get the facts here: http://www.floodsmart.gov/floo...ance_is_required.jsp
Not sure how this old thread came to light again but it is timely. Just got the bill to renew the insurance policy and, YES, the premium went up. Guess they like those who pay every dime on time and never have a claim to make!
I had almost forgotten that I started this thread over a year ago - gave in and bought the mandated insurance since we had no choice re the loan - EVEN THOUGH a flood will never occur where this property is located and the only way that would happen would be IF the Lucky Peak dam fails.
In that event, the entire capital city of Idaho (Boise) will be washed away before the water ever gets within miles of our farm... not going to happen.
I'm not against insurance for realistic risks of floods - just against political re-drawing of flood maps to enable insurance companies to re-gain profits by forced participation after the recent unusual floods of last year that caused insurance companies' profit to take a dive. Hope my premiums helped out their profit margin.
So who re-started this old thread anyway? And why?
metwo, It's actually pretty simple - the insurance companies and banks have very strong representation on Capitol Hill. Let's just call it was it is. All of the recent legislation of the "mandatory flood insurance expansion" is a result of those hired to lobby for the insurance companies' goals.
Insurance companies' bottom line took a BIG hit last year (2011) with all of the floods - no problem - just need to add MORE people into the equation to share the risk, right? So pass a bill requiring all Banks to require flood insurance for the newly-drawn perimeters - send out the new requirements to everyone who has a mortgage. It's pretty basic - re-draw the lines so banks can require you to purchase the insurance yourself or pay 5 times the going rate.
And, how in the world, can anyone dispute the new "flood" plain maps? They can't, so, here, metwo, is your answer and HOW it came about since you figure the insurance company is innocent in all of this - re-draw maps including more area, require all banks with federally guaranteed loans to enforce mandatory coverage with 4x premiums as a penalty - bottom line? Insurance companies are looking pretty good to re-coup all of their losses from last year.
A coincidence? Think not... the lobbyists for the insurance companies achieved their goal. I'd stick around for a while but must go pay bills including the one for my so-called "flood insurance" - think the company knows that we are a pretty safe bet. Never a claim = more money on the black. Hey, "stay-cations" can be fun ....
Are you sure that you were not speaking about Homeowenrs Insurance? Fema I didn't think had those high fees. unless you are practically in the water.
Anyway, I pay 400.00 a year to Fema. not to my homeowners insurance, According to their Tables I don't need to, not on the Flood table area. And guess what,? no rivers around, not water that near. and yet. Three weeks ago, we had over 20 inches of rain that flooded part of my house, made a sinkhoke in the middle of my street. so, If you want to take that risk, be my guest. I won't.
rker, I agree. We were in the same situation as you, and when a swollen creek came too close for comfort to our home after a massive rainfall from Hurricane Hermoine, we opted to buy flood insurance ($358 per year) even though we are technically in a low-risk 500 year flood plain area where it is not required. Our insurance is paid to FEMA.
We live in a very proactive community, and after that flood, our HOA embarked on an extensive program to eliminate invasive cedar shrubs and fallen trees that were blocking the flow of the creek -- which contributed to the flooding.
Our insurance is less than a dollar a day and gives us great peace of mind. Unfortunately, neighbors near the creek sustained tens thousands of dollars in out-of-pocket damages.
Easy fix, if allowed in your community and your neighbor is completely in the flood zone, sell/convey that piece of land to your neighbor who is already paying flood insurance.
My first hubby worked with a fella back about 20 yrs. ago who researched everything before he bought a lot & built a house. He was out of the 500 yr. flood plain. NO flooding should ever occur on his lot.
Well in 1994 it did! Put his built on blocks (elevated/no basement) in the water. They got over 1' of water inside. This was due to a tropical storm that came north & SAT...for several days.
I wasn't able to go to work for 4 days. A lot of the areas that flooded had never flooded before and were not in the 500 yr. flood plain. So you just never really know what will happen.
"The soil is the source of life, creativity, culture and real independence." David Ben-Gurion
Yes you can! by obtaining current FEMA and Fed Bureau of Reclamation maps. If none are available, demand the mortgage company prove your property is in danger of flooding.
IR, unlike folk with beach front homes & flatlanders, our Fed flood insurance premiums are based on potential failure of an up-river DAM compounded by the possibility of a domino effect = aging upstream multiple dams (Lucky Peak).
if the dams upstream from me fail, I won't live to collect a checkThis message has been edited. Last edited by: tessa89,
My first encounter with a hurricane in Florida was IVAN and what an experience that was.
Insurance companies battled with many homeowers regarding their liability. All insurance conmpanies decided that most of the damage that occurred during that hurricane was due to flood and not wind damage.
That became a football between the homeowners and the Insurances.
Having seen how many homeowners were gipped by the Insurences, We decided then, that even, if we are not required to buy flood insurance we would. So when another hurricane comes to this area. NOne of my insurances would be able to blame each other and not pay for damages.
Regarding the flood maps, we just got a new one and our home still is not on a flood area, but we just had a flood in one of our rooms because of 20 inches of rain, so. go figure, I rather be safe than sorry. and floods occur in places where no one thought about it before.
Rker, Exactly what we did. When we first built a small corner of our lot was in the flood zone and our bank required flood insurance. Not a big deal, even though we are on a tidal marsh and are about 1/2 mile as the crow flies to the ocean it was on about $375 a year. When we refi'd several years later the bank said we were no longer in the flood zone. DH dropped the flood coverage, but it always worried me because we are on a tidal marsh. (During Hugo many houses on the east side of the marsh ended up in the marsh, or else their roof or other parts! ) My fear was always someone's very large car or house part would damage the pilings our house sits on or we would have standing water which would compromise our foundation. We added the flood insurance back and it is now up to $400 a year. Pretty cheap peace of mind consider we pay over $4000 a year in insurances.
And believe me, if you ever are hit with a hurricane or anything else, the fight will begin as to whom is to blame, The homeowners insurance will try to tell you that it was not wind damage but flood damage and the fight will begin.
We are on a hill, the highest hill in our area. We don't carry flood insurance, however, we have really thought about it after what happened to us.
Our house has a crawl space about 4-4 1/2' tall and it built on a tall foundation about 2' above the ground w/pillars down the center in the crawl space.
When we had a tropical storm (Faye) come & sit for several days & drop 12+" on us, our crawl space got about 2' of water inside it....and we have a small berm in front of the house to direct water away from the foundation.
You just never know what can happen! If we had gotten even more rain there is a possibility that we could have flooded before we figured out what was happening. DH bought a portable sump pump & we pumped it out...and now if we have a long, heavy rain...WE CHECK!
"The soil is the source of life, creativity, culture and real independence." David Ben-Gurion
Saw that this old thread I started last year has gained momentum so thought I would weigh in. Yes, there are many reasons to carry flood insurance but we gave in because of the new (re-drawn) FEMA maps which gave our mortgage holder the clout to require it - just after the diasterous floods of last year! And those federal regulations were fueled by lobbying from the insurance companies - that is after all how legislation gets passed!
I understand the situation with other states BUT here in Idaho, we don't get hurricanes, tropical storms, or any other natural disasters that include water AND annual rainfall is only 11.71 inches per year so it's hard to see the rationale for flood insurance.
I do have to agree with tessa89 that, where we are located, only massive multiple dam failures could create a problem and I wouldn't be alive to make a claim should that occur - but the capital of Idaho (Boise) would be swept away long before any water would ever get to our farm!
Oh, well, would say more but must go find the latest bill for the increased premium and write a check - like I said earlier, "staycations" are under-rated although, personally, I would rather have the money to spend as I want instead of bolstering insurance companies bottom line.
I don't know how much flood insurance costs in your area, but even on the coast it is very inexpensive. One of the major lobbyists for the renewal of Flood Insurance was the NAR.
I do not get a penny for any policy my buyers purchase, but I encourage each and every buyer to get flood insurance. A small price to pay if there is any running water, and in developed areas that running water is frequently diverted underground.
As for putting money in insurance companies pockets - that is not flood insurance.
Check out the FEMA website and learn more about Flood Insurance and the processes put in place to help homeowners who have been remapped.
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