Strickler Insurance has been closely following FEMA’s flood insurance changes over the past 4 years and FEMA has finally implemented their new Risk Rating 2.0 which bases flood insurance off of zip codes. Below is our most recent update to the flood insurance policy changes. Below that you can read our past two articles on that topic as well.
At Strickler Insurance, we want you to stay informed on insurance so you can make the best decisions possible for your family’s safety and protection. Contact us to receive updates and learn more about the best insurance policy for your personal situation.
Risk Rating 2.0’s Impact On Flood Insurance
We can expect large increases for flood insurance at beachfront properties as well as areas that have had a high impact of floods in the past. There is also a chance you will see a decrease in flood insurance costs.
Essentially the design of the new flood insurance risk rating is to target high flood insurance payout areas with greater costs, while low flood insurance payout areas will have lower costs. The hardest area hit with flood insurance costs is South Florida. Some of those areas in Florida will see a 342% increase in flood Insurance costs.
FEMA Updates Flood Insurance Policies: Implications for Pennsylvania Residents
Residents of Pennsylvania could anticipate seeing major effects from recent changes to FEMA’s flood insurance policy, which is now based on zip codes. This article will address the effects of the new policy and look at ways to reduce the cost of flood insurance.
In Pennsylvania, FEMA’s flood insurance update (in the spring of 2023) is largely dependent on location. In PA, we have seen more unpredictable weather and record floods in the past 10 years, especially in Lebanon County. Within Pennsylvania, we have a large number of rivers and streams that make a range of areas impacted by this most recent flood insurance change by FEMA. While you may be in a zip code that has high flood insurance, it does not mean you are required to have flood insurance. This is still dependent on flood zones as well as other factors.
Understanding FEMA’s Flood Insurance Policy Change
The decision by FEMA to base flood insurance rates on zip codes has important ramifications for homes in Pennsylvania. This strategy tries to more precisely depict the real risk levels connected to flood-prone locations. In the past, regardless of where a property was located, the elevation of that property above the base flood elevation essentially influenced flood insurance prices.
The new approach, however, takes into account more variables including previous flood data, alterations in climatic patterns, and particular topographical threats connected to each zip code.
Will My Flood Insurance Go Up Or Down In PA?
It depends on where you are located in PA. Pennsylvania has a variety of environments, from rural settlements along rivers and streams to heavily crowded urban regions. As a result, the new FEMA flood insurance policy may have various degrees of impact on households throughout the state. Increased insurance costs are more likely to be observed in areas close to flood-prone rivers like the Schuylkill, Susquehanna, or the Delaware river. Residents of places less likely to flood, however, could see more favorable rates.
What Are My Options To Keep My Flood Insurance Affordable?
While it is difficult to stop FEMA’s flood insurance premiums from rising, Pennsylvanians can take proactive measures to lessen the financial strain. As we have mentioned in past articles, you should consider private flood insurance. This can negate the flood insurance increases FEMA is implementing and the policy will take more into consideration when assessing your home for flood insurance.
Past Articles On FEMA’s Flood Insurance Updates
Below are two past articles we wrote on FEMA’s Flood Insurance updates. We have been keeping track of all information they released regarding the change and have been able to accurately assess what would be most effective for homeowners in flood planes to do before the rates increased.
Risk Rating 2.0 | 2022 Flood Insurance Undergoes Major Change
Originally Published April 2022
We all know that the United State’s Flood insurance program is a bit outdated. They are taking major steps to improve their flood insurance program as well as their flood zone breakdown. With these steps to improve flood insurance, the coverage cost for a lot of high-risk homes will dramatically increase, while some people might see a drop in their flood insurance rates.
The purpose and goal behind FEMA’s flood insurance changes are to provide more accurate flood insurance rates.
Flood Insurance Rated On A Case By Case Basis
As FEMA has dedicated large sums of money and time to studying and analyzing the floodwaters throughout the United States they have become better equipped to handle floods in our area. With the culmination of studies and historical data, they can better assess the likelihood of a flood and the level of damage.
As FEMA improves, and their data improves they have been able to maximize the accuracy of flood insurance premiums. A person who is on the very edge of a flood zone and has no history of actual flooding should not have to pay the same flood insurance premiums as someone who lives at the heart of a flood zone and regularly has flood claims.
The solution is the original blanket flood insurance premiums are now going to be approached and assessed on a case by case basis. How can this be done? Risk Rating 2.0
What Is Risk Rating 2.0 In Flood Insurance?
Risk Rating 2.0 is the NFIP’s new approach to determining a home’s flood rating and the required flood insurance premium.
How Does Risk Rating 2.0 Work?
By entering the address of your home the FEMA map assesses your home, the flood zone you are located in and the outlying factors of flooding. Outlying factors of flooding include your home’s flooding history, changes to the flood zones as well as how likely your home is to flood. Taking all of this data your risk rating is determined and your flood insurance premium is determined.
The end result of these changes to flood insurance is more accurate premiums and better flood insurance coverage.
What Are My Options If My Flood Insurance Risk Rating Is High?
With flood insurance being set by the government, no matter where you get your flood insurance coverage it will be about the same premium. Unless you get private flood insurance.
Private flood insurance is the best option for people who saw a large increase in their flood insurance from their Risk Rating. Private flood insurance provides a variety of options for an affordable price.
Contact Strickler Insurance For A Free Flood Insurance Quote
Strickler Insurance is in a unique position where we can compare many different types of flood insurance. Whether you want private flood insurance or federal we can run a quote for you and find which one provides the best coverage at the most affordable cost. Contact us today!
Changes To Flood Insurance Incoming
Originally Published August 2021
Flood Insurance Changes 2021-2022
Flood insurance costs are changing? Why? FEMA’s flood insurance plans and pricing are a bit outdated. Some areas have not been reviewed for many years; some places have probably not been reviewed since FEMA was set up in 1979. This has resulted in flood insurance being way overpriced for some homeowners as well as underpriced for other homeowners.
In this article, we will take a look at what is impacting flood insurance and resulting in the changes to flood insurance plans. We will also look at how those impacts will increase or decrease your flood insurance. Finally, we will look at FEMA’s new flood insurance plan called Risk Rating 2.0.
Why Is Flood Insurance Changing?
As technology improves and the environment changes, the flood zones change. There are a variety of factors that impact flood insurance premiums as well as flood zones. As FEMA updates its approach to flood insurance, here are a few things to take into consideration when your flood insurance changes.
Changes In The Market Are Impacting Your Flood Insurance Rates
While inflation and market changes have been rampant over the first 20 years of the 21st century, the market has violently changed due to covid. The worth of your home has skyrocketed as the market favors buyers and lumber prices soar. A large sum of money has flooded the market with the recent stimulus plans and resulted in an excelled inflation rate.
Environmental & Water Table Changes Affect Your Flood Insurance
With environmental changes, increased development, and the sheer number of parking lots, water displacement has increased flash flooding, erosion, and increased flood zones. If a new home or a parking lot was placed near you, the square footage of land that is now concrete has displaced that amount of water.
As more and more locations are developed, a larger amount of water displacement occurs. Rather than the ground absorbing the water, it runs into streams and rivers. These combined environmental factors lead to increased flooding and, as a result, increased flood zones.
Think about how much your local town or county has changed in the past 20 years. That alone has played one of the largest roles in impacting the flood zone.
Technology & Data Can Change Your Flood Insurance
Along with flood zone changes, technology is continually advancing at a rapid pace. With those advancements, the NFIP is more and more equipped to predict when and where flood levels will rise. However, when the NFIP was first set up in 1968, the technology and maps used to create the flood planes were not at the same caliber they are today.
If the most advanced technology were to study your local town’s floodplain for 3 years, the NFIP could probably predict the flood levels and continued floodplain changes over the next 10 years. Using new and advanced technology to study the flood plain is helping to change flood insurance by making it more accurate.
FEMA Impacts Your Flood Insurance
Finally, FEMA impacts your flood insurance. FEMA and the NFIP work together as a government entity to determine effective flood insurance plans and rates. The upcoming changes they plan to make to flood insurance are in the interest of making it more accurate.
Why Is FEMA Updating Its Flood Insurance?
There is no denying that FEMA’s flood insurance is antiquated and motivated by too many factors that are not related to flood zones or protecting infrastructure within the United States. Unfortunately, this can still be seen, and families still feel the impact years after mass flood events.
Many areas still have yet to recover from hurricanes and flash floods. While FEMA’s flood insurance updates may result in higher prices for flood insurance, it is designed to take an outdated government program and work correctly for the people purchasing flood insurance.
What Is Risk Rating 2.0?
Risk Rating 2.0 is a new implementation by FEMA. Risk Rating 2.0 essentially means higher-risk flood plains will probably see an increase in flood insurance costs. This makes sense, just as home insurance is more if the home is a higher risk home with a trampoline or pool. Meanwhile, lower risk flood insurance will probably remain the same or only see a slight increase.
If I am in a lower-risk flood zone, why will I see my rates still increase? Because of the multiple reasons listed above. What are high-risk areas that could expect to see an increase in their flood insurance costs? According to Forbes, it is a lot of beachfront properties.
What The Changing Flood Zones Mean For Homeowners
It is extremely likely the flood insurance coverage for your home will increase. However, if you are nervous about the changes that are happening to federal flood insurance, you should consider trying private flood insurance. There are a lot of advantages to private flood insurance. At Strickler Insurance, we provide both private and federal flood insurance options. Contact us for a free flood insurance quote.