Flood Insurance for a Severe Repetitive Loss Home

[alligatorob]

Florida

I live near the coast and am trying to figure out what is happening with flood insurance, and my agent is of no help. My property:

Constructed in 1955
I purchased in 2000
My primary residence
I believe we are in the V zone
FEMA has classified the property as a Severe Repetitive Loss property, and it does appear to fit the definition (4 claims over $5k since 1980)
Our home is about 3200 ft2 on two levels, all historic flood damage has been on the lower level, not upstairs
Downstairs walls are predominately uninsulated concrete block.
Even the upstairs floor is below the current BFE
So far as I know it has always been insured and all building was to code at the time
I have made only 1 claim, in 2005 we had flood damage from Hurricane Dennis
I was unaware of the earlier claims when I purchased the house, we had no way of knowing this was or would be considered a Severe Repetitive Loss property, in fact I don't think that classification existed when we purchased.
My flood insurance premium is currently about $3,500 for $250k in coverage, I understand this may go way up in 2014.

After Dennis we spent a lot of $ to reduce future flooding impact on our home:

Moved the kitchen upstairs, above the level of any historic flood damage
Replaced all downstairs carpet with tile flooring (on the concrete slab)
Replaced all downstairs sheetrock with T-111 (plywood)
Removed all insulation below historic flood level
Elevated the water heater and AC unit above historic flood levels
Moved all downstairs wiring, including outlets and switches above historic flood levels ~4 ft off of the floor
Added a 1 inch layer of reinforced concrete covered by stucco to outside cinder block walls
Added concrete apron along house where flooding erosion had threatened the foundation
Replace sliding glass doors with french doors to provide better flood water venting

I am an engineer and I studied nearby houses destroyed and damaged by Dennis, these are all changes to limit any future flood damage to our house, and as a result I am confident floods similar to the historic ones that created claims would not result in a claim now. But our mortgage requires flood insurance and realistically I know a more powerful hurricane could cause greater damage, so we need the insurance.

My questions are what will happen to our premiums next year and what can we do about it?

Can we get any credit for the mitigation we did?

One thing that might be an option is trying to somehow only insure the upstairs area, that is now where we live and have our bedroom, living room, bath and kitchen. Problem is even the upstairs is still below the current BFE. Elevating the house is not an option, it's an old concrete block home on a slab. The only way to elevate is demolish and rebuild.

I know this is not exactly a legal question, but I know there are some insurance experts who read this and am hoping for some advice.

 

[sandyclaus]

Florida

I live near the coast and am trying to figure out what is happening with flood insurance, and my agent is of no help. My property:

Constructed in 1955
I purchased in 2000
My primary residence
I believe we are in the V zone
FEMA has classified the property as a Severe Repetitive Loss property, and it does appear to fit the definition (4 claims over $5k since 1980)
Our home is about 3200 ft2 on two levels, all historic flood damage has been on the lower level, not upstairs
Downstairs walls are predominately uninsulated concrete block.
Even the upstairs floor is below the current BFE
So far as I know it has always been insured and all building was to code at the time
I have made only 1 claim, in 2005 we had flood damage from Hurricane Dennis
I was unaware of the earlier claims when I purchased the house, we had no way of knowing this was or would be considered a Severe Repetitive Loss property, in fact I don't think that classification existed when we purchased.
My flood insurance premium is currently about $3,500 for $250k in coverage, I understand this may go way up in 2014.

After Dennis we spent a lot of $ to reduce future flooding impact on our home:

Moved the kitchen upstairs, above the level of any historic flood damage
Replaced all downstairs carpet with tile flooring (on the concrete slab)
Replaced all downstairs sheetrock with T-111 (plywood)
Removed all insulation below historic flood level
Elevated the water heater and AC unit above historic flood levels
Moved all downstairs wiring, including outlets and switches above historic flood levels ~4 ft off of the floor
Added a 1 inch layer of reinforced concrete covered by stucco to outside cinder block walls
Added concrete apron along house where flooding erosion had threatened the foundation
Replace sliding glass doors with french doors to provide better flood water venting

I am an engineer and I studied nearby houses destroyed and damaged by Dennis, these are all changes to limit any future flood damage to our house, and as a result I am confident floods similar to the historic ones that created claims would not result in a claim now. But our mortgage requires flood insurance and realistically I know a more powerful hurricane could cause greater damage, so we need the insurance.

My questions are what will happen to our premiums next year and what can we do about it?

Can we get any credit for the mitigation we did?

One thing that might be an option is trying to somehow only insure the upstairs area, that is now where we live and have our bedroom, living room, bath and kitchen. Problem is even the upstairs is still below the current BFE. Elevating the house is not an option, it's an old concrete block home on a slab. The only way to elevate is demolish and rebuild.

I know this is not exactly a legal question, but I know there are some insurance experts who read this and am hoping for some advice.

You're right. It isn't a legal question.

The only way to answer the question is to have the property inspected by the insurance company and discuss your efforts to mitigate your likely future damages.

I will say this - the classification of your property as SRL had to have occurred with the 4th major loss in 2005. You would have had to be placed in a special category for special coverage under NFIP. In order to maintain NFIP coverage, you would be required to participate in a mitigation program thru NFIP. I suggest that you contact them to discuss what you've already done and see what else is needed to successfully mitigate any future losses.

 

[alligatorob]

Thanks for the answer, I have spoken with my insurance agent but they seem to know little or nothing about this, and all the flood insurance ultimately comes from the federal government. Apparently I am the only SRL property my insurance agency handles.

I will say this - the classification of your property as SRL had to have occurred with the 4th major loss in 2005. You would have had to be placed in a special category for special coverage under NFIP. In order to maintain NFIP coverage, you would be required to participate in a mitigation program thru NFIP.

I did get some information on the mitigation program and tried without success to get FEMA to answer questions about what could be done and how. The folks at FEMA who I spoke with seemed to have a limited script they spoke from and could not answer any specific questions. They offered no program and only told me general things about mitigation that I already knew but which were not applicable to my home. This was all before the Biggert Waters Flood Insurance Reform Act, which I understand has eliminated the SRL program.

 

[OHRoadwarrior]

Pay your house off and do not carry flood insurance. Simple solution.

 

[sandyclaus]

Thanks for the answer, I have spoken with my insurance agent but they seem to know little or nothing about this, and all the flood insurance ultimately comes from the federal government. Apparently I am the only SRL property my insurance agency handles.


I did get some information on the mitigation program and tried without success to get FEMA to answer questions about what could be done and how. The folks at FEMA who I spoke with seemed to have a limited script they spoke from and could not answer any specific questions. They offered no program and only told me general things about mitigation that I already knew but which were not applicable to my home. This was all before the Biggert Waters Flood Insurance Reform Act, which I understand has eliminated the SRL program.

Try looking at this page for more information on mitigation procedures: http://www.fema.gov/hazard-mitigation-assistance

In addition, if your insurance agent is unfamiliar with the National Flood Insurance Program, then I would HIGHLY suggest that you find an agent who is. It's absolutely unacceptable to be dealing with an agent who is unfamiliar with the flood insurance requirements in your area, especially since you live in a property already identified as an SRL. You have specialized needs, and you need to have an agent who is better suited to meeting those needs. You can find one here: http://www.floodsmart.gov/floodsmart/ (official site reference).