FEMA: Most Properties See No Increase for 2015 Flood Insurance

There’s good news for homeowners who need flood insurance. The Federal Emergency Management Agency (FEMA) recently announced no premium increases in 2015 for most properties in the National Flood Insurance Program.

Rates will be held constant from the October 2013 insurance rate charts, according to Austin Perez, National Association of Realtors® (NAR) Senior Policy Representative for Environmental Issues. Some homeowners may also see refunds later this year.

“Beginning October 1st, owners of older properties will continue to pay the 2013 insurance rates which were not based on elevation certificates,” Perez said. “Homeowners will either see the same rate or lower when the rates are rolled back to the previous insurance rate tables.

“FEMA is trying to do its best to develop a more accurate and consistent method for determining insurance rates,” he added. “They’re going back to what they did before when FEMA calculated the rates for all older properties; they’re taking all the guess work and mis-readings of elevation certificates out of the equation.”

Based on the regulations enacted in the Biggert-Waters Act, those who purchased an older property were given an insurance rate based on an elevation certificate. Perez explained that if the home was more than two feet below a flood plain, the insurance rate jumped to “full cost” using special ‘submit to rate’ procedures and judgments about the property as well as correct readings of the elevation certificate which were too complicated.

Also Perez said second-home owners who saw more than a 25 percent increase in their rates will see a refund for the difference. If the insurance rate should have been $2,000 (including the 25 percent increase) but the rate was higher, the homeowner will see a refund for anything above the $2,000.

“When Congress stepped in by enacting the Homeowner Flood Insurance Affordability Act of 2014 it tried to alleviate the problems brought about by the Biggert-Waters Act and FEMA is responding to that,” he added.