Flood insurance?

[withm]

The FEMA Flood maps are revised periodically - what may not have been a "high risk" area as determined by FEMA a few years ago could well be one now.

That can explain why a lender who did not require flood insurance even just a few years ago, may have that requirement now (or vice versa) on the same property.

If you look at the survey you received when you settled on your house, if the flood elevation was performed, the survey would state what flood zone you are in (AE, A, etc followed by a number). This is your flood zone designation. But you'll still need the elevation certificate to go further.

When I was trying to buy gap insurance to cover only the perceived gap in coverage provided by my condo association and what the bank thought it should be (????) I learned that the insurance broker could not even quote this coverage without having the information on the elevation certificate.

Here's a link to the FEMA Elevation Certificate - this form needs to be filled out by a licensed surveyor. You'll be able to see the level of detail involved that is required to determine the BFE for your home. Only when you have the BFE for your home can you determine if flood insurance should be purchased regardless of any lender's requirements.

http://www.fema.gov/library/viewRecord.do?id=1383

You really need to have this done to make any kind of evaluation.

Incidently, the flood insurance program (like any other government entity) is often under attack. You may find this article interesting from the Feb 22 edition of Coastal Contractor. There is legislation being proposed to eliminate the Fed. flood insurance program. BTW, it states that all flood insurance is subsidized through this program, and suggests that there is no source for flood insurance outside of this program.

http://www.coastalcontractor.net/article/434.html

One other thing to keep in mind, there is a waiting period for flood insurance, in that if you buy it today, there is a 30-day waiting period for coverage. So if the hurricane is coming next week, you can't buy insurance now and expect to be covered next week. This period is waived when buying a new house.

[Mr. Bloom]

Indy, you're too busy to sort this out. Stop being soooo self sufficient

You're too close to not get the insurance...start the process with your insurance agent, they're paid to sort it out...test their knowledge along the way if you think they're just taking a path of least resistance. If you're not in zone A, I think the insurer can underwrite it and take FEMA out of your process

You can also look at the appraisal and/or survey from your purchase. Check your realtor as well. Here, the gis shows flood prone areas and topography with reasonable precision. See if you have that up there.

[indysteel]

Indy, you're too busy to sort this out. Stop being soooo self sufficient

Agreed. If you saw my desk right now....

But the lawyer in me likes to figure things out on my own, especially when they are at least partially related to The Law. I have orders into DH to contact our agent and I'll take a look at our closing docs, both for the original purchase and refi.

Ugh, Mr. B. It seems like everything I touch these days is overly complicated. It's not just the flood insurance. Every friggin' case I'm working on makes my head hurt. Add in my obligations with the Y, and I'm nearly tapped out. Our week's vacation to Utah next month cannot come fast enough.

[indysteel]

Thanks for the additional info, withm. I'll digest it fully tonight, but I did look at the article you linked to. That's just the thing I was trying to get a feel for, i.e, how stable is this program to begin with. I also found a website that discusses some of the problems you can anticipate with the program.

That's not to say that I won't get flood insurance; I just what a realistic understanding of how much faith to place it. I gotta first determine whether I can get it, whether I should, and how much it's going to cost.

Thanks for everyone's input.

[Mr. Bloom]

Ugh, Mr. B. It seems like everything I touch these days is overly complicated. It's not just the flood insurance. Every friggin' case I'm working on makes my head hurt. Add in my obligations with the Y, and I'm nearly tapped out. Our week's vacation to Utah next month cannot come fast enough.

Welcome to the life of a banker in the 21st Century! You're just farther down the food chain dealing with the final phase of the "cycle". Good news is that you're the leading indicator for things getting better

[indysteel]

Welcome to the life of a banker in the 21st Century! You're just farther down the food chain dealing with the final phase of the "cycle". Good news is that you're the leading indicator for things getting better

Ironically, Mr. B., little of what I work on these days involves a loan gone bad, although the case that's most bothersome right now is just that, but not from a traditional lending institution. Half the due diligence and twice the fun! Most of what I deal with is interpersonal stuff gone awry. Desperate people take desperate measures and do crazy things along the way. It's up to us to sort it out. It's like Judge Judy without the cameras and cussing. Oh, and throw some actual law in there as well.

Sorry for the thread drift. I've had a long couple of months at work and needed to vent.

[Mr. Bloom]

All a function of the same economic environment...as I said, welcome to my life!

[bmccasland]

All a function of the same economic environment...as I said, welcome to my life!

the economics are easy
There are FEMA flood zones, which will indicate if homes and businesses within those zones have a certain risk for flooding.
There's the actual elevation of your house and the BFE (which could have been revised post construction).
Then there's whether or not you are willing to pay the complete cost of recovery if you have a flood.

One other little tidbit... if you have flood insurance and have multiple flood events, there's a percentage of damage from the last event, after which you'll be required to raise (or raze) your house. I've seen homes that flooded after major rain storms in my neighborhood carpet was out on the street - that were being raised 3-4 ft. Fortunately for said lifting, small business loans are available. Pretty much, after a point, you have to do something to the structure of your house to reduce the risk.

[frostflakes]

So helpful to read everyone's comments in this threads - thanks for sharing all! I'll also add in my two cents, read an excellent article on flood insurance - http://www.gettingmoneywise.com/2011...insurance.html about when you actually need it and when it's not all that necessary. Hope that helps anyone else out who's still looking for info