Latest news with #NationalFloodInsuranceProgram
New York Times
4 days ago
- Business
- New York Times
Who Should Consider Getting Flood Insurance? These Days, Almost Everyone.
With the Atlantic hurricane season about to start, this may be good time to consider buying flood insurance for your home — even if you don't live in a hurricane-prone area. Officials at the National Oceanic and Atmospheric Administration said this month that they were expecting more than the average number of hurricanes during the season, which begins June 1 and runs through November. NOAA predicts as many as 19 named storms, with six to 10 of them strengthening into hurricanes. An average season has 14 named storms with seven becoming hurricanes. Flood insurance should not be seen as important only for property owners near the ocean, insurance experts note. While properties near the coast are in particular peril, areas far inland have had severe flooding in recent years as a warming climate spawns intense storms that drop heavy rainfall. Won't my homeowner insurance policy cover flood damage? No. Standard homeowner insurance policies don't cover damage from floods, which are the most common and costly natural disaster in the United States. Flood protection — which typically covers damage from rising water entering a home — requires a separate policy, available from the federal government's National Flood Insurance Program or from certain private insurers. Borrowers with federally backed mortgages in certain high-risk areas are generally required to carry flood coverage, but it's largely optional otherwise. What if I don't live near a coastline? You should still evaluate buying flood coverage, insurance experts say. Consider this example. In September, Hurricane Helene made landfall on Florida's gulf coast as a powerful Category 4 storm, then moved inland, traveling hundreds of miles north. The storm drenched parts of six states and caused record flooding in western North Carolina. Want all of The Times? Subscribe.
Miami Herald
27-05-2025
- Business
- Miami Herald
Florida Bill Could See Higher Flood Insurance Costs This Year
A bill trying to "bolster hurricane relief and recovery" in Florida could end up increasing the cost of flood insurance for thousands of homeowners in the state, experts warned, adding more weight to their growing financial burden. Senate Bill 180, which has already passed both the Florida House and Senate with nearly unanimous support, is now heading to Governor Ron DeSantis' desk. The bill aims to help homeowners in the Sunshine State rebuild more quickly after natural disasters, which are becoming more frequent and destructive due to climate change. However, in its attempt to expedite these efforts, critics argue that the legislation may hinder residents from implementing key changes that would enhance their homes' resilience to extreme weather events. Florida homeowners have seen the cost of home insurance skyrocket in recent years due to a combination of more frequent and severe natural disasters, widespread fraud, and excessive litigation. Although the market has stabilized over the past year, homeowners in the state continue to pay some of the highest premiums in the country. At $2,625 per year, the average cost of home insurance in the state is 24 percent higher than the national average of $2,110, according to NerdWallet. Flood insurance, which is not required by law, is an additional cost on top of the standard property insurance policy for homeowners in the state. According to NerdWallet, the average annual cost of flood insurance in the state is $865 for a National Flood Insurance Program (NFIP) policy. Changes introduced by SB 180 could increase the cost of flood insurance even further for Florida homeowners, potentially discouraging some from obtaining coverage for their homes at all-a risky proposition in such a disaster-prone state. SB 180 has been celebrated by sponsor Nick DiCeglie, a Republican state senator representing Indian Rocks Beach, as legislation that would offer Florida homeowners "a clear path to recovery" after being hit by a storm. "We're fighting for families to focus on rebuilding without additional delays or burdens, especially for those who sustained damage or lost their homes," the senator said in a press release. "Working with our state and local emergency responders, we can streamline restoration efforts and improve emergency response coordination, fortifying and strengthening our communities before the next storm." Newsweek reached out to DiCeglie via email for comment on Monday. The bill's efforts to streamline rebuilding after a hurricane, however, include a two-year freeze on the adoption of stricter building codes that could strengthen Florida homes, a measure that critics say would prevent local governments from introducing important reforms. It would also make it easier for homeowners whose properties have been destroyed or damaged in a natural disaster to avoid elevating their homes once they rebuild-an improvement that experts consider crucial to strengthen residences against more frequent and more severe extreme weather events. Under the proposed legislation, only homes that have suffered storm damage equal to more than 50 percent of their value must be demolished and rebuilt entirely-the minimum requirement set by the Federal Emergency Management Agency (FEMA). Strengthening a home exposed to potentially devastating natural disasters not only makes this property more resilient, protecting the owner and their assets, but it also makes coverage more affordable. Insurers often offer discounts to policyholders who make efforts to strengthen their homes against extreme weather events under programs such as FEMA's Flood Mitigation Assistance Grant and the Sunshine State's Elevate Florida. This state-run program, launched last year, offers to cover at least 75 percent of the cost of mitigation projects, including elevating a home damaged in a storm, which promises to lower insurance costs and increase the property's value. A study conducted by the state and cited by several local newspapers found that 44 out of the 122 communities that currently elevate their homes after an impactful natural disaster would lose points toward discounts on flood insurance premiums due to SB 180. Twelve would no longer qualify for the level of discount they currently benefit from: Bay County, Leon County, Orange County, Dania Beach, Jupiter Beach, Palm Springs, Estero, Lake Mary, Hialeah, Bonita Springs, Hollywood and the Pensacola Beach Santa Rosa Island Authority. According to the study's estimates, approximately 44,000 Florida homeowners would end up paying more for flood insurance coverage as a result of the bill taking effect, resulting in a total annual increase of $1.6 million statewide, or $36 per person. Florida state Senator Nick DiCeglie, who sponsored the bill, in a statement: "If we can keep one more person in their home to keep them out of the 50 percent rule, that's one person that does not have to deal with the incredibly stressful situation of tearing down their home and elevating." Del Schwalls, a floodplain management consultant, told the Tampa Bay Times: "It's really frustrating. It prevents anyone from trying to fix this flood, repair, flood, repair cycle." Kimberleigh Dinkins, policy and planning director of advocacy group 1000 Friends of Florida, in a statement: "A lot of times, a local government can evaluate the impact that a storm has on their community, and make adjustments to their land development code to make themselves more resilient. Under this scenario, they wouldn't be able to do that." She added: "It's removing one of the tools in the toolbox to increase resiliency. It basically is saying: okay, you have more opportunities to build back in a way that's resulting in flooding." The bill is now awaiting the governor's signature, but DeSantis has not yet indicated whether he will sign the legislation. If signed, the bill's provisions could take effect during the upcoming hurricane season, potentially affecting insurance premiums and building standards statewide amid ongoing market volatility. Related Articles Florida Homeowners 'Living Nightmare' As Construction Company Goes BankruptHow Donald Trump Could Boost US High-Speed RailFlorida Man Dies in Police Shooting After Surviving Apparent Gator AttackFlorida Boat Explosion: 11 Reported Hospitalized After Blast in Waterway 2025 NEWSWEEK DIGITAL LLC.
Yahoo
20-05-2025
- Business
- Yahoo
How much flood insurance do mortgage lenders require?
Mortgage lenders require flood insurance on homes in certain FEMA-designated flood zones. Typically, the coverage requirement is either the full replacement cost of the home, the maximum amount allowed by the National Flood Insurance Program or the unpaid balance of the mortgage, whichever is less. You don't need to buy flood insurance if your lender doesn't require it, but since standard homeowners insurance doesn't cover flood damage, it might still be worth getting a separate policy. If you need a mortgage for a home in a flood zone, your lender will likely require you to purchase flood insurance. Here's why, how much coverage you'll need, what it'll cost and more. If you're buying a home in a Special Flood Hazard Area (SFHA), most types of home loans — including a conventional mortgage backed by Fannie Mae or Freddie Mac or an FHA, VA or USDA loan — require flood insurance coverage. Typically, you must have a policy that covers the full replacement cost of your home, the unpaid balance of your mortgage or the maximum coverage allowed by the National Flood Insurance Program (NFIP), whichever is less. Most flood insurance coverage is provided via the NFIP. The NFIP offers coverage for the property itself up to $250,000, as well as up to $100,000 for personal property. If your home is higher in value, the $250,000 NFIP ceiling might not be enough. To cover that gap, you can get a supplemental flood insurance policy from a private company. These policies aren't as readily available as NFIP coverage, however, and they will likely cost more and have higher deductibles. Learn more: Investment property mortgage rates If your home is in an area with a moderate to high risk of flooding — or an SFHA — your lender will almost certainly require flood insurance. In fact, if you're getting a government-backed loan, the lender is required by law to mandate it. The Federal Emergency Management Agency (FEMA) maps flood hazard areas, and you can find out whether a property is in one by plugging the address into FEMA's Flood Map Service Center. Keep in mind that your lender may require flood insurance even if you don't live in a SFHA — but if you do, you're very likely to need the coverage. Mortgage lenders require flood insurance for the same reason they require homeowners insurance: to protect their interest in the property. 'If flood damage is suffered and funding is not available to repair, the home's value diminishes significantly, which negatively impacts the lender and the homeowner,' says Kyle Herring, partner at Strategic Claim Consultants in San Antonio, Texas. This is why you might need to buy flood insurance even if you're not buying in a high-risk area or getting a government-backed loan. According to 2023 data from FEMA, about a third of flood insurance policies in force for single-family homes cost less than $1,000 per year, while another third cost between $1,000 and $2,000 annually. If NFIP coverage is available in your area, it'll likely be the most affordable option. The average cost of NFIP insurance is approximately $800 yearly, says Madelyn Rodriguez, a partner at Clausen Choquette, PLLC, a legal firm in Boca Raton, Florida which specializes in insurance disputes. She adds that 'this amount varies greatly by the location of the property, amount of coverage needed and proximity to bodies of water.' Flood insurance premiums can also increase from year to year, both for policies through the NFIP and private insurers. But the law limits increases to no more than 18 percent per year for most policyholders. Additionally, flood zones and classifications can change. You may buy a home that's not in a flood zone, but it is designated as a flood zone later on. This means you might be required to get flood insurance or pay more for it. 'If you have lower policy limits, you may also want to increase your flood policy coverage limits in the future as the cost of construction increases,' says Rodriguez. Note: In 2021, FEMA adopted a new rating system for NFIP policies. Here's more on those flood insurance rate changes. Learn more: Second home mortgage rates How to lower your flood insurance premium If you live in a high-risk flood zone, taking steps to mitigate flood damage can help lower your premium. These might include: Elevating the lowest floor of your home Elevating your HVAC and other essential systems Installing a sump pump or backflow check valve Getting an exterior floodwall The simplest way to avoid your mortgage lender's flood insurance requirement is to buy a home outside of a flood zone. Of course, that might not be an option for some. If possible, you could pay for the home in cash, but even then, you might still want to purchase flood insurance. Flooding happens on a near-daily basis throughout the U.S., and standard homeowners insurance doesn't cover flood damage. Is flood insurance required on a lot loan? If you're purchasing land with a structure of any kind on it, even if it's a barn or another building you wouldn't live in, flood insurance may be required. The lender will perform a flood determination, and depending on the findings of that assessment, a policy may be required. Is flood insurance required for a home equity loan? If your home equity loan is secured by a home located in a SFHA, then you'll need to have flood insurance on that home. Can a lender waive the flood insurance requirement? It may be possible to avoid paying flood insurance if you can prove that your home is located higher than the highest area flood waters are likely to reach. In this case, you may apply for a Letter of Map Amendment, known as a LOMA, from FEMA. Obtaining a LOMA allows lenders to waive flood insurance requirements. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
20-05-2025
- Business
- Yahoo
Climate Change Is Coming for the Housing Market
The financial toll of climate change isn't just theoretical — it's hitting home, quite literally. According to First Street, a climate research firm, weather-related disasters could drive a 380 percent surge in U.S. foreclosures over the next decade. By 2035, nearly one in three foreclosures could be linked to climate impacts like flooding and wind damage. Who could be the hardest hit? First Street warns that moderate-income households are particularly vulnerable to severe weather damage. Since much of Americans' wealth is tied up in their property values, this trend could lead to financial devastation for many families. The fallout won't stop with homeowners. As climate-driven foreclosures climb, lenders could face losses of $1.2 billion annually by this year, potentially soaring to $5.4 billion over the next decade as they absorb the cost of mortgage defaults. But don't assume this crisis will only affect coastal areas. Here's a closer look at where climate-related foreclosures are expected to rise. According to First Street, U.S. communities most at risk for climate-related foreclosures in the coming years are typically densely populated, high-property-value areas with many underinsured homeowners, often located along the coasts. Florida stands out as a prime example. It's home to eight of the top 10 counties projected to face the highest credit losses from extreme weather. In particular, Duval County, which includes Jacksonville, could see up to $60 million in credit losses — caused by customers or borrowers failing to repay debts or loans — from 900 foreclosures during a severe weather year, based on CBS's analysis of First Street's data. And it's not just the Southeast — further north, Ocean County, New Jersey, could see credit losses reaching $13 million. California is also projected to face billions in losses across the state. San Bernardino County, for example, could incur up to $13 million in credit losses, while Sonoma County might see around $2 million. A similar trend is emerging in the South, where Harris County, Texas, which includes Houston, could face losses as high as $34 million. The financial fallout from climate change won't stop at the coasts. Inland regions like the Mountain West and the Great Lakes are increasingly vulnerable to climate-related credit losses, too. According to First Street Foundation, flooding is a key driver behind rising foreclosure rates in these areas, particularly where homeowners lack flood insurance and are more likely to default on their mortgages. Unlike standard homeowners insurance, flood coverage isn't broadly required. It's mandated only for those with federally backed mortgages who live in FEMA's designated Special Flood Hazard Areas. As of August 2023, just 3.1 million flood insurance policies were active under the National Flood Insurance Program. But the true scale of risk goes far beyond that; FEMA's maps identify about 8 million properties in high-risk flood zones, yet First Street estimates nearly 18 million homes nationwide face substantial flood risk. Why the gap? FEMA's flood maps primarily account for river overflows and coastal storm surges, leaving out a major and growing threat: extreme rainfall. As climate change intensifies, so do rain-driven floods that can hit neighborhoods well beyond the official flood zones. This insurance blind spot has costly consequences. First Street's analysis of 29 flood events between 2002 and 2019 found that homes outside FEMA's designated zones saw foreclosure rates 52 percent higher, on average, than those within the zones. It's a jarring warning sign: Homeowners who think they're safe, or aren't required to carry flood insurance, may be most at risk. Unfortunately, FEMA's flood maps aren't likely to be updated anytime soon. The Association of State Floodplain Managers estimates it could cost up to $11.8 billion to complete new mapping — a price tag unlikely to be met, especially amid federal budget cuts across the board. Given this, experts say the best step homeowners can take is to check whether they have flood insurance. 'If you don't protect yourselves, then when the event does occur, it's completely on you,' Jeremy Porter, head of climate implications at First Street, told CBS. 'You end up having to pay out of pocket and you may go into foreclosure.' The post Climate Change Is Coming for the Housing Market appeared first on Katie Couric Media.
Yahoo
20-05-2025
- Business
- Yahoo
Neptune Flood Research Group Releases Analysis Confronting the Growing Flood Risk in Texas
Largest private flood insurance provider highlights increasing flood risk as coverage declines ST. PETERSBURG, Fla., May 20, 2025 /PRNewswire/ -- Neptune Flood has released its latest research issue exploring the accelerating flood risk across Texas and the widespread underinsurance that threatens to magnify its impact. With more than 2.1 million properties projected to face flood exposure over the next 30 years, and over 200,000 expected to flood with near certainty, Texas is facing a critical insurance shortfall. Urgent action is needed to close this gap and strengthen the state's resilience. Key Findings in Texas According to the First Street Foundation, of the 2.1 million properties at risk, 1.15 million face at least a 1% annual chance of flooding. By 2050, the Texas Water Development Board (TWDB) expects mass migration, development trends, and climate intensification to add 2.6 million more people and 740,000 new buildings into high flood risk areas. FEMA maps identify only 860,000 total at-risk properties, highlighting the mapping inadequacy. Nearly 50% of all active National Flood Insurance Program (NFIP) policies in Texas are Pre-FIRM homes (older structures more vulnerable to loss). Since 2005, over 52% of NFIP claims in Texas have occurred outside FEMA-designated high-risk flood zones. The Cost of Inaction Texas ranks second nationally in NFIP claims, with over 150,000 claims and $11.6 billion paid over the past decade. Harris County accounts for nearly 50% of all NFIP payouts statewide, yet over 78% of homes remain uninsured. According to TWDB, the state has identified over $54.5 billion in needed flood risk reduction solutions, yet only $10.6 billion in available funding has been identified. Texas's Widening Coverage Gap Only 7% of residential properties statewide have flood insurance. In major inland metros like Dallas, Denton, and Bexar, coverage rates remain below 1% despite repeated flood events. Even in FEMA-designated high-risk zones, only 28% of residential buildings have flood insurance coverage. Since the launch of Risk Rating 2.0 (FEMA's new property-level pricing model) in 2021, average flood insurance premiums in Texas have risen 35%, while the number of buildings covered has dropped 30%. As rates transition to full-risk pricing over the coming decades, affordability concerns grow, with premiums consuming an average of 4-5% of household income in some counties. "Texas faces a clear and growing flood risk, yet millions of properties remain without adequate insurance coverage," said Matt Duffy, President of Neptune. "This report underscores the scale of the challenge and the need to improve both awareness and access to flood protection. As flood risk continues to rise due to climate change and development patterns, and with an active 2025 hurricane season on the horizon, addressing these gaps remains a critical priority for homeowners, insurers, and policymakers alike." Texas stands at a critical juncture. The convergence of outdated flood maps, rapid development, climate change, and declining insurance coverage has created a perfect storm of risk and vulnerability. Addressing this crisis will require a coordinated effort - leveraging better data, smarter policy, public-private collaboration, and expanded private flood insurance coverage. This report aims to inform that effort and provide a roadmap for strengthening resilience in the face of growing flood threats. Click here to view the complete analysis. About Neptune Flood Neptune Flood is the largest private flood insurance provider in the United States, revolutionizing the industry with AI-driven underwriting and machine learning technology. Neptune simplifies the flood insurance process, offering instant, affordable, and comprehensive coverage in minutes—without the delays and complexities of traditional insurance. Operating in 49 states and Washington, D.C., with Alaska launching soon, Neptune is committed to closing the flood insurance gap and making coverage accessible nationwide. View original content to download multimedia: SOURCE Neptune Flood
