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Flood Insurance Information

insurance policy paper

Flood Insurance

Flood insurance is an important first step in protecting your financial investment. Over the life of a 30-year loan, a home in a high-risk area (known as a Special Flood Hazard Area) has about a 3 times greater chance of having a flood than having a fire. In accordance with the Flood Disaster Protection Act of 1973 and the National Flood Insurance Reform Act of 1994, flood insurance is required for all structures located in a high-risk area, that carry a home mortgage loan backed by a federally-regulated lender or servicer. The risk can vary dramatically from neighborhood to neighborhood and within a neighborhood. Remember, flood insurance is available for all properties, regardless of risk designation, and is the only insurance that protects you from flood damage. Learn more by visiting the National Flood Insurance Program consumer website.

Zone Changes May Affect Flood Insurance Costs

Insurance costs may rise for some to reflect heightened risk. Likewise, some property owners may find their risk is now reduced and that they are eligible for an optional, low-cost flood-insurance policy. Learn more about the Preferred Risk Policy.

Flood Insurance Requirements and Options

When the new maps are adopted, some property owners' flood insurance requirements will change. However, options exist that will allow property owners to save money while still protecting their property.

If Maps Show... These Requirements, Options, and Savings Apply
Change from low or moderate flood risk to high risk

Flood insurance is mandatory. Flood insurance will be federally required for most mortgage holders.* Insurance costs may rise to reflect the true (high) risk.

Grandfathering offers savings. The National Flood Insurance Program (NFIP) has "grandfathering" rules to recognize policyholders who have built in compliance with the flood map or who maintain continuous coverage. An insurance agent can provide more details on how to save.

Change from high flood risk to low or moderate risk

Flood insurance is optional, but recommended. The risk has only been reduced, not removed. Flood insurance can still be obtained, at lower rates. Twenty-25 percent of all flood insurance claims come from low-to-moderate-risk areas.

Conversion offers savings. An existing policy can be converted to a lower-cost Preferred Risk Policy.

No change in risk level

No change in insurance rates. Property owners should talk to their insurance agent to learn their specific risk and take steps to protect their property and assets.

* Flood Insurance is mandatory.

Flood Risks and Flood Zones

Flood maps refer to areas of high, medium or low risk as "flood hazard zones" and the zones of highest risk as "Special Flood Hazard Areas."

Risk Level Flood Hazard Zone
High Flood Risk

AE, A, AH or AO Zone. These properties have a 1 percent chance of flooding in any year - and a 26 percent chance of flooding over the life of a 30-year mortgage.

Insurance note: High-risk areas are called Special Flood Hazard Areas, and flood insurance is mandatory for most mortgage holders.

Low or Moderate Flood Risk

Shaded X Zone. These properties are outside the high-risk zones. The risk is reduced but not removed.

X Zone. These properties are in an area of overall lower risk.

* Insurance note: Lower-cost preferred rate flood insurance policies (known as Preferred Risk Policies) are often an option in these areas.

Benefits and Further Information About the National Flood Insurance Program:

  • Most Homeowner's insurance does not cover flood damage.
  • There typically is a 30-day wait after the purchase of a flood insurance policy before it becomes effective.
  • Properties located in low- or moderate- risk flood zones (marked B, C, or X on the flood maps) can and still do flood; but property owners may be eligible to purchase a flood insurance policy, a Preferred Risk Policy, at reduced premiums.
  • Historically, 20-25% of all flood claims paid out are on properties located outside of high risk areas, known as Special Flood Hazard Areas (SFHAs).
  • The higher up a property owner raises their structure above the base flood elevation in high risk areas (to a certain limit), the lower their insurance premiums will be. A property owner in a high risk area could save as much as 50% in premium payments by building just 2-3 feet above the base flood elevation.

Where to Go For Further Information on Insurance:

Explore the links below to download official FEMA flyers and brochures on Flood Insurance.