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. However, property owners may be able to save money by purchasing insurance prior to map adoption (anticipated Fall 2011). This process is called Grandfathering a flood insurance policy (learn more on Grandfathering). 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 by visiting the Preferred Risk Policy website.

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

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

Floodsmart.gov an official NFIP Website (Homeowners, Business Owners)
NFIP Technical Website (Agents, Lenders, Surveyors, Local Officials)
FEMA Information for Insurance Professionals and Lenders

Why Buy Flood Insurance ?

Buying flood insurance is the best thing you can do to protect your home, business, family, and financial security from a flood.

When you are a flood insurance policyholder:

Flood insurance compensates you for all covered losses.
Coverage is relatively inexpensive.
You can depend on being reimbursed for flood damages, even if the President does not declare a Federal disaster.
Your covered losses are paid in full. You do not have to repay a loan, as you might have to with many Federal disaster relief packages.
You can count on your claim being paid in the event of a flood loss because NFIP flood insurance is backed by the Federal government.
Your agent can help you handle your claim quickly, so that you will not have to put your life on hold if your property is damaged by a flood. You can even request a partial payment immediately after the flood, which can help you recover even faster.

FOR MORE INFORMATION Visit http://www.hernandocounty.us/FloodMap/ to view the new digital flood maps, see the areas that are changing flood zones and learn how Hernando will be affected. Visit www.FloodSmart.gov for more information about how to protect against flooding and the steps local residents may need to take to ensure that they have proper insurance coverage to protect their investment.