News
The New Umbrella of Flood Insurance
Gordy Bunch, President & CEO, TWFG Insurance Services.
HOUSTON, June 8, 2015 /PRNewswire/ — 2015 is already on the record books as one of the worst years of flooding in U.S. history. The nation’s Midwest and Gulf Coast communities are afloat with homes, vehicles, trees, and personal belongings as the result of record-breaking rainfalls.
More than 163 billion gallons of rain deluged the Houston area alone. For the fortunate few who signed up for policies tied to the National Flood Insurance Program (NFIP), rebuilding will be less painful and less costly, says Gordy Bunch, president and CEO of The Woodlands Financial Group (TWFG). Bunch is a national FEMA flood agency award winner and a director of The Woodlands Township, a premier master-planned community just north of Houston with 30,000 homes.
The National Oceanic and Atmospheric Administration has assigned a “major” rating to recent flooding in the states of Texas, Oklahoma, Louisiana, Alabama, and Arkansas. Minor to moderate flooding has occurred in Missouri, Kansas, Nebraska, Colorado, South Dakota, and Wyoming. The threat of flooding is about to become compounded by the Hurricane Season which usually affects Florida and the East Coast. High tide floods have been forecast in 2015 by NOAA.
FEMA’s new flood insurance program went into effect on April 1, 2015, so Bunch cautions that the new program could affect policy holder rates and deductions. Thousands of homeowners and small business firms may need to pay higher premiums regardless of the extent of their damage.
The Federal Emergency Management Agency (FEMA) says flood insurance is an essential ingredient for protecting your family. Too many victims of this year’s flooding felt a false sense of safety because they thought their homes were situated above flood waters, says Bunch. The Blanco River in Texas, which normally crests at 13 feet, reached 44.5 feet. Bunch always reminds customers that their homeowners policies do not cover flooding. Flood insurance fills that void and if your insurer participates in the NFIP program you can file claims even if a storm situation does not trigger a federal disaster declaration. If your home is listed in a flood plain, your mortgage company will insist that you buy flood insurance.
The NFIP has 5.3 million policyholders in homes and businesses across the country with $1.3 trillion of insurance coverage in force. Among the many FEMA changes which were combined with new flood maps identifying Special Flood Hazard Areas (SFHA) are:
Increased fees for most policies.
New deductible options with a maximum of $10,000 for single family homes and two-to-four family dwellings could result in a 40% discount.
Increase in the Federal Policy Fee.
Limiting increases for individual premiums to 18 percent of premium.
Limiting increases for average rate classes to 15 percent.
“Grandfathering” can provide a lower-cost rating for policies in force when the new flood maps became effective.
Gordy Bunch recommends that prospective or renewing policy holders go to FloodSmart.com for more information and updates from FEMA.
For Media Information:
Gordy Bunch 713-416-0789
gordy@twfg.com
SOURCE The Woodlands Financial Group
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