Rhode Island Flood Map Meetings |Flood Insurance Changes
Changes to 2013 Flood Insurance in RI
The Rhode Island Emergency Management Agency (RIEMA) in coordination with the Federal Emergency Management Agency
(FEMA) will be having RI Outreach Meetings to help answer questions related to the Flood Insurance Reform Act of 2012. This re-authorization goes to September 2017 in RI real estate. Click here for more information on meeting dates and times.
In July 2012, the U.S. Congress passed the Biggert-Waters Flood Insurance Reform Act of 2012 which calls on FEMA, and other agencies, to make a number of changes to the way the National Flood Insurance Program is managed. Key provisions of the legislation will require the NFIP to raise rates to reflect true flood risk, make the program more financially stable, and change how Flood Insurance Rate Map (FIRM) updates impact policyholders.
These map changes will mean insurance premium rate increases for some — but not all — policyholders over time. Homeowners and business owners are encouraged to learn their Rhode Island flood map risk and talk to their insurance agent.
In RI’s Washington County, there are now 2230 subsidized flood policies and there are 3593 policies not subsidized. Certain types of policies will see a 25% increase a year in flood insurance over the next 4 years until it is at a non-subsidized level. I have written about these flood plain changes over the last year to prepare RI buyers and sellers of the flood map changes.
The re-authorization applies to certain homes built prior to the first flood insurance rate map. As well as policies based on the Rhode Island flood map in effect when the home was built, otherwise known as grandfathering. For residents who own properties that are located in flood-prone areas (ocean, bay, streams, etc.), these changes by Congress may cause flood insurance premiums to increase as much as 25% annually. The new law aims to reflect full risk and phase out subsidized rates for certain policies in the Rhode Island flood map including:
Secondary homes in a Special Flood Hazard Area
Commercial properties in a Special Flood Hazard Areas
Multi-family residences (1-4 units) that have suffered severe and repeated property losses
Properties that have incurred flood-related damages in which accumulated claims payments have exceeded the fair market value of the property
In addition, the Federal Emergency Management Agency (FEMA) is currently in the process of coastal re-mapping for all twenty one (21) coastal communities in Rhode Island. This mapping effort may place some properties into higher risk zones known as Special Flood Hazard Areas (Zones A and V). Properties that fall into these areas will be required to pay significantly higher premiums;
Therefore it is important for all property owners to know their current and future flood risk. It is my understanding that the mapping has been finalized and can be reviewed in your Town’s Planning department to see if your home and property is impacted by the changes.
The law is also calling for a phase-out of discounts and grandfathered rates and a move to insurance risk based rates when policy holders get re-mapped into a high risk area. This phase-out will take place in 20-percent increments annually over the course of five years and is expected to begin in 2014. This may come as a huge shock to many RI homeowners.
What is a homeowner to do that is or may be impacted by these changes? Talk to your insurance company and see what you can do. Many homeowners may not be able to afford both real estate taxes and the high cost of flood insurance on their homes. But the best you can do now is be informed and form an action plan.
These are big changes and may impact you, your neighbor or family so please share this information with them. As a RI coastal real estate agent, I am here to assist you as you decide on your real estate options.
Whether you are buying or selling in the RI coastal real estate market, I would love the opportunity to earn your trust and business.
As always, call me, Ginny Lacey Gorman, at (401) 529-7849 so we can discuss your RI real estate options.