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Can You Save on Flood Insurance Costs?

New Floodplain Maps Rate Your Risk

By Jann Wiswall

Home and business owners in Ellicottville are encouraged to review new flood insurance rate maps to see if they can reduce their flood insurance costs or eliminate the need for flood insurance altogether.

The new maps were the brainchild of the Town and Village of Ellicottville, Ellicott Development and Sprague Development, which together surmised that existing Federal Emergency Management Agency (FEMA) floodplain maps created in the 1970s for areas impacted by Great Valley Creek, Elk Creek and Holiday Valley Creek were out of date and inaccurate. If that was true, some people probably were paying too much for flood insurance.

The group hired a civil engineering study contractor who worked for more than a year collecting data, recalculating elevations and assessing the flood-control impact of new bridges and culverts. That information was submitted to FEMA, which subsequently issued the revised maps for the village and certain areas of the town. These maps are now in a six-month public comment period before they become effective in February 2015.

The maps are available for public review until Feb. 4, 2015 at the town hall and online at the town’s website at www.ellicottvillegov.com/html/tbldgdept.htm, then click on “Flood Zone Map.”

According to Ellicottville Town Engineer Mark Alianello, there was no change to about 90 percent of the floodplain boundaries. There were, however, some subtle changes to the shape of the overall floodplain and, in many areas, meaningful reductions to the depth of potential flooding above the existing ground.

A floodplain is what FEMA calls a “Special Flood Hazard Area” (SFHA), defined as an area that has the potential to be inundated during a “100-year” flood. A 100-year flood is one that has a 1 percent chance of occurring each year. An SFHA is calculated using rainfall data, detailed topographic information, the shape of the drainage basin, precise elevations and more.

“If you haven’t seen a 100-year flood in your lifetime, that doesn’t mean it won’t happen,” Alianello says.

Statistically speaking, there could be more than one 100-year flood in a single year, or there could be none for 150 years.

If you live in the floodplain and have a mortgage, your lender requires you to carry flood insurance, and it’s a good idea. But flood insurance costs have been increasing since new FEMA flood insurance laws were instituted between 2012 and 2013 that eliminated and phased out numerous insurance subsidies and discounts. Increases have averaged 25 percent per year and will continue to increase until “full flood risk” is reflected.

With the new maps, some residents whose properties are no longer in the floodplain or whose risk for flooding is lower can work with their mortgage companies to adjust their rates or eliminate the requirement altogether.

If you don’t have a mortgage but carry flood insurance, you may be able to work with your insurer to reduce your rates once the new maps take effect in February 2015.

In some cases, your insurer or mortgage lender may require you to hire an engineer or surveyor to complete an elevation certificate. The certificate is used by the insurance company to rate the risk of flooding to your property and to establish your premium. While the cost of doing so may be in the $500 range, you may be in a position to save far more in insurance costs every year.

In some instances, the elevation certificate could reveal that your structure and the land immediately surrounding it are actually above the 100-year flood elevation. If so, you may apply to FEMA for a “Letter of Map Amendment” (LOMA). If FEMA issues a LOMA, your mortgage company is no longer obligated to require flood insurance.

Alianello noted that before cancelling your flood insurance, you should at least get an estimate of what a new premium would cost. It may be that the new premium is reasonable and worth the money for peace of mind.

Overall, Alianello says that the new maps more accurately depict the extent and severity of potential flooding and expects that some people will see lower premiums as a result. In fact, he has spoken with one resident who may be able to reduce her flood insurance premium from $2,000 per year to $350.

If you or a developer is building a new home in a floodplain, flood insurance costs can be reduced by raising the building above the minimum required elevation standards. Other mitigation strategies are described at www.floodsmart.gov.

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