A 100-Year Flood
When you hear the weatherman talking about a 100-year flood, it is almost as misleading as seeing gumbo listed on a South Dakota menu. Sure, they might serve you some warm liquid in a bowl, but that doesn’t make it gumbo. A 100-year flood isn’t a flood that happens once in 100 years; it’s one that has a 1% chance of happening every year. While a 1% chance of flooding doesn’t sound bad, it adds up over time. Over 30 years, the length of most home loans, there is a 26% chance of a 100-year flood. That’s a much higher chance than getting gumbo in South Dakota.
Flood zones and base flood elevations (BFE) can be a little confusing too. FEMA is responsible for determining the flood zones and BFEs used in determining the cost of flood insurance. An area’s flood zone and BFE are based mostly on its history of flooding. There are many different flood zones but only three risk categories; undetermined, moderate to low, and high-risk. The areas where the flood risk is undetermined are listed as flood zone D. Flood zones B, C, and X are for areas of low to moderate risk areas outside of the 100-year flood zone, protected by levees, or flood control systems.
Properties in the A or V flood zones are high risk or Special Flood Hazard Areas having a 1% or greater chance of flooding every year. The high-risk areas are often shown as AE or VE with a number at the end. The BFE is the number of feet above NGVD or what most people think of as meaning sea level. To qualify for preferred flood insurance rates the home must be in the low to moderate risk zones, or the elevation of the lowest finished area in the home must be equal to the BFE.
Now that we covered the basics about flood zones, there are a couple more important things to know. Flood zones, like everything else in our lives, are subject to change. As new roads, subdivisions, buildings, levees, or just about anything is built around us, it can change the flooding potential. FEMA regularly reevaluates an area’s flooding risk and adjusts flood zone classifications or elevation requirements. So, a property’s flood zone and flood risk today may be changed tomorrow. Just like the flood zones, the rules and rates for flood insurance change too.
When a flood happens, and it will, only a flood insurance policy, not your homeowner’s policy, covers damage to your home and its content. On top of covering the cost of damages due to flooding, having a flood insurance policy can help protect the value of your home in the future. Purchasing and maintaining a flood policy ensures the availability of coverage in the future if the flood zone or BFE changes.
If you or your clients need help identifying a property’s flood zone or understanding the available costs and coverages of a flood or homeowner policy, our team of licensed insurance professionals are here to help.
Choice Insurance Group