In last week’s post, we discussed the different flood zones and what they mean for your property. Remember, all properties and homes in the US are in a flood zone. Here is a quick refresher of the three current flood zones:
- An “X” zone is considered non-hazardous and lenders do not typically require flood insurance in these areas. “X” zones are supposed to have less than a 1% chance of flooding each year.
- “AE” zones are considered moderately hazardous, and lenders will typically require that flood insurance be obtained in these zones.
- “VE” is considered the most hazardous – high-velocity or high-risk, and a lender will typically require flood insurance be obtained in these zones. These coastal areas have an additional hazard associated with storm waves, and have a 26% chance of flooding over the life of a 30-year mortgage.
Once you determine your property’s flood zone, you and your agent can determine the cost of coverage.
Coverage in “X” zones will run approximately $400 +/- per year depending on the size of your home.
In an “AE” zone, homes built to a positive elevation or with proper flood venting (more on that in a minute) will cost approximately $500 – $600 per year. Homes built to a negative elevation could cost as much as $2000 per year, or more. Beware – a full or partial enclosure under an elevated home can cause the home to be rated at a negative elevation.
In a “VE” zone, homes built to a positive elevation will typically run between $2,000 – $4000 per year. Homes built to a negative elevation can run as high as $6000+ per year. Beware – a full or partial enclosure under an elevated home can cause the home to be rated at a negative elevation.
When building or buying a home, you will want hire a surveyor to create an elevation certificate which will determine the elevation and flood zone of the dwelling. Please remember that an enclosure underneath an elevated home (like a bathroom, enclosed storage room, additional bedroom, elevator, etc.) may cause the entire home to be rated at the elevation of the enclosure rather than the elevated floor. So while that elevator may be a great convenience for moving groceries into the house, know that it can cost you significantly more in flood coverage.
Proper flood venting is also important, as this helps to reduce pressure by allowing floodwaters to move through your enclosure, thus causing less damage from a flood event. Breakaway walls for enclosures (as opposed to fully finished walls with studs, drywall, etc.) can also be a good idea as these will simply pull away from the pilings during a flood event and not cause additional damage to the structure.
If you must have an enclosure, here are some general rules to keep you out of trouble. In an AE zone, the square inches of flood vents should be equal to or greater than the square footage of your enclosure. The walls should be breakaway and have less than 20 linear feet of finished wall space. In a VE zone, your enclosure should be less than 300 square feet, made of breakaway walls, and have less than 20 linear feet of wall space. While flood vents may help to reduce damage in a VE zone, they do nothing to help reduce your flood insurance costs – only in an AE zone can they help to reduce costs.
The current maximum coverage amounts allowed through the NFIP (National Flood Insurance Program) are $250,000, for the dwelling and $100,000 for contents in a single family home; however, excess flood programs are available through other carriers such as Lloyds of London. As always, it’s vital to have a good agent who can help to mitigate your costs and ensure your properly covered.