Bw12 presentation 1.5 hour with crs and darlingotn
Is Your Flood Insurance Going Up
1. Is Your Flood Insurance
Going Up?
Arcturus Presentation
March 25, 2016
2. What are we going to talk about?
1. The Surface Transportation Bill (H.R. 4348) and
Biggert-Waters Insurance Reform Act of 2012.
2. Provisions or exceptions for historic buildings.
3. Rep. Maxine Waters issues a statement
expressing her "outrage“.
4. The Homeowners Flood Insurance Affordability
Act (HFIAA).
5. Southeast Florida Coastal (FIRM) Study
4. The Surface Transportation Bill (H.R. 4348) and
Biggert-Waters Insurance Reform Act of 2012.
• Signed into law July 2012.
• Extended the National Flood Insurance
Program through 2017.
• Phased out subsidized rates for certain types
of real estate; investment and second homes.
• Annual premiums are allowed to increase by
25% per year until they achieve the full
premium rate (plus pre-BW12 rate schedule).
• Save NFIP - $18 billion debt. ($51B by 2013).
5. Premium Rate Structure Reform
• Phases out subsidies for second
homes, business properties,
severe repetitive loss, or
substantially improved or
damaged properties.
• Rates for these properties will
increase by 25 % per year until
premiums meet full actuarial
cost.
• Requires that any premiums for a
NEW flood insurance policy for a
property not currently covered
must be based on actuarial rates.
6. "FEMA defines a non-principal/non-primary
residence as a building that will not be lived in
by the insured or the insured's spouse for at
least 50% of the 365 days following the policy
effective date".
7. Provisions or exceptions for historic buildings
• BW 12 makes no special provisions or exceptions for
historic buildings. Historic buildings are to be treated
the same as any other Pre-FIRM (1975) properties.
• All primary residences – including those that are
historic buildings – built Pre-FIRM that are located in
special flood hazard areas (flood zones A, AE, AH, AO,
A1-A30, V, VE, V1-V30) and D zones will see a 16% to
17 % increase effective on October 1, 2013. Plus a
5% Reserve Fund.
• X-Flood Zone? All policy holders not included in the
above zones will receive a minimum 5% Reserve
Fund assessment. (I've heard as high as 17%).
8. Florida has 40% of flood policies
nationwide
• According to a 2011
analysis by the University
of Pennsylvania's
Wharton Center for Risk
Management and
Decision Processes, over
the past 35 years, Florida
property owners have
paid $16.1B in premiums
while collecting $3.7B in
claims.
• Louisiana, paid $4.4B in
premiums, collected
almost four times that in
claims (Katrina).
• Since 1978, Texas paid
$5.5B in premiums
• New Jersey paid $4.8B in
premiums.
• New York paid $4.4B in
premiums.
9. Rep. Maxine Waters (co-author) issues a
statement expressing her "outrage“.
• What about our politicians and how they voted
for the Surface Transportation Bill?
• Senator Nelson voted in favor.
• Senator Rubio voted against.
• Representative Ros-Lehtinen voted in favor.
• Representative Garcia was not in office. Has
written to FEMA Administrator Craig Fugate and
introduced delaying legislation.
10. The Homeowners Flood Insurance
Affordability Act (HFIAA)
• President Obama
signed on March 21,
2014.
• HFIAA delays, reduces
and restructures flood
insurance rate increases
designed by the Biggert-
Waters Act of 2012
(BW-12).
• Primary residences only.
11. The Homeowners Flood Insurance
Affordability Act (HFIAA)
• Rate increases: HFIAA aims for annual increases of 5% -
15% with a cap at 18%. (Plus pre-BW12 rate schedule).
• BW-12 required homebuyers to pay the full-risk rate for
pre-FIRM properties at the time of purchase. HFIAA,
homebuyers will continue to pay the same flood insurance
as the home seller.
• BW-12 terminated grandfathering. HFIAA says, if you were
once in compliance with flood maps, then new maps will
not push you out of compliance.
• FEMA will refund policyholders who paid premiums in
excess of new rates.
• Requires FEMA to certify its mapping process is
technologically advanced and justifiable. Requires FEMA to
send communities remapping data .
12. The Homeowners Flood Insurance
Affordability Act (HFIAA
• Compels Congress to provide funding to FEMA so FEMA can
reimburse those who successfully challenge FEMA
mapping.
• Charges a $25 surcharge to primary homeowners and $250
surcharge to non-primary homeowners. Surcharges will be
placed into a Reserve Fund to pay NFIP's $24B debt.
• Allows FEMA to go to the private sector re-insurance
industry and capital markets to obtain re-insurance of
coverage provided by the flood insurance program.
• Requires FEMA to conduct a flood insurance rate
affordability impact study with associated regulations to
cover any unaffordability issues.
13. The Homeowners Flood Insurance
Affordability Act (HFIAA)
• Conservative and
environmental groups
oppose HFIAA.
• Fiscally irresponsible.
• Continues subsidized
buildout of flood risk
coastal areas.
• The higher the risk area,
the higher the subsidy.
14. Southeast Florida Coastal Study
• The effective date of Key West's Flood
Insurance Rate Map (FIRM) is 2005, from a
Datum level dated 1929.
• The new study will establish a new FIRM with
an effective date of 2019, from a Datum level
dated 1988.
• Information about the engineering and social
process to accomplish this Study can be
explored at www.southeastcoastalmaps.com.
15. • Determine revised Base Flood Elevations
(BFEs) and flood inundation boundaries for 1%
annual chance (base) flood total water levels.*
16. V-zone = waves 3' or more, Coastal A-zone = waves between 1.5'
and 3', A-zone = waves up to 1.5' and X-zone = no waves.
17. Monroe County
Technical Update Meeting
• Technical review of mapping methodologies
and data collection.
• NOAA, EPA, US Geological Society coordinate
analysis program - gradual and surge flooding.
• Natural and man-made topography. Shoreline,
canals, water depths, vegetation, roads,
buildings, varying land elevations …
• Draft flood maps estimate complete Jan 2017
with Community Outreach Spring 2017.
18. Monroe County
Technical Meeting Update
• What is Vertical Datum?
• North American Vertical
Datum 1988 (NAVD88).
• Datum change does not
change relationship of
ground heights to water
surface.
• Property owners risk is
not affected by change
in datum.
