biggert waters presentation

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Page 1: Biggert waters presentation

Biggert-Waters Flood Insurance Reform

Act of 2012

State Rep. Charles Busby HD-111

Page 2: Biggert waters presentation

What is Biggert-Waters??

On July 6, 2012, the Congress of the US signed the Biggert-Waters Flood Insurance Reform Act of 2012

• Reauthorized the National Flood Insurance Program (NFIP) for 5 years

• Discontinue certain premium subsidies

• Mandated that NFIP charge risk-based or

• actuarial rates to each property covered.

• Create a Reserve Fund (5% to all)

• Study future flood insurance issues

Page 3: Biggert waters presentation

Flood Policy Terms to know:

Subsidized = Not rated using risk based (actuarial) rating.

Pre-FIRM = Built prior to a communities initial Flood Insurance Rate Map.

High Risk Flood Zones = Flood zones starting with an A or V or D

Low to Moderate Risk Flood Zones = Flood Zones B, C, or X

Risk-based Rating = Matching both the premium charged for flood

insurance to the established risk of flooding.

EC (Elevation Certificate) = Licensed surveyor form describing elevations,

characteristics of a building and flood zone risk for flood policy

risk- based rating.

Lapsed policy = where premium payment is received beyond the 30-day grace

period following the policy’s expiration date.

Tentative rates = rates developed to allow policies to be issued until risk based

rates can be applied. Good for one policy term only.

Page 4: Biggert waters presentation

Exercise

• Raise your hand if you live in a SFHA. (V, A, D zone)

• If your home was built after 1974 put your hand down

• If the elevation of your home is equal to or above the BFE

and you have a EC with your agent put your hand down.

Page 5: Biggert waters presentation

Section 205 Deals with Pre-Firm

Properties and Commercial Properties• Residential property that is not a primary residence

• Severe repetitive loss properties

• Property with cumulative losses exceeding FMV

• Any commercial property

• New policies, lapsed policies, policies for newly purchased properties

• Any policy where the owner has refused a FEMA mitigation offer

• Properties built prior to 1974 or community’s adoption of FIRM

• Properties that sustain damage exceeding 30% of FMV after July ‘12

The policies will increase 25% per year until

reaching actuarial rates

Page 6: Biggert waters presentation

Section 207 Deals with Post FIRM

Properties after Remapping• Coastal Mississippi was remapped in 2007

• Hancock County requested remapping and it is taking

place now.

• Post FIRM primary residences rates will increase 20% per

year until reaching actuarial rates based on new maps

• 2 bills working through congress to delay for 1 year

• Funds were allocated to accelerate remapping over the

next 5 years

• Input into the remapping process is crucial

Page 7: Biggert waters presentation

It’s Not All BAD!!!

• Increases mitigation funds

• Increases mitigation options including

Demo and Rebuild!!

• If you are above BFE your rate might just

decrease!!

Page 8: Biggert waters presentation

Premium comparisons- Non actuarial vs. actuarial

Non-Actuarial

$2,563/yr

$2,563/yr

$2,563/yr

$1,835/yr

$15,183/yr

$6,442/yr

Actuarial

Building- $250,000 Contents- $100,000

(Oct. 1, 2013 rates, slab on grade, one story, single family)

The above is calculated with no CRS discount

Page 9: Biggert waters presentation

Sample Policy

• Residence Insured for $200,000 Building

• 1 Foot below BFE AE Flood Zone

• Building – First $60,000 @ $4.40 Per $100 = $2,640

• Remaining $140,000 @ .97 Per $100 = $1358

• Total Cost - $3998.00

• Same House 1 Foot Above BFE - $566.00

• Same House 2 Foot Above BFE - $364.00

Page 10: Biggert waters presentation

How Can We Affect Remapping?

• Rebuild the barrier islands.

• Scrutinize model input data.

• Accuracy of Topography

• Accuracy of manmade structures impacting surge and waves

• Accuracy of modeled storms

• Relevancy of modeled storms

• Build dikes or levees. (feasible for areas subject to river

flooding but less likely for coastal properties)

Congress has authorized $400,000,000 per year for

2013 through 2017 for flood mapping!!!

Page 11: Biggert waters presentation

Revised Mitigation Programs

• Consolidates and streamlines programs.

• Funds at $90MM per year versus $50MM previously.

• Allows Flood Mitigation Plan to be part of community’s

multi-hazard mitigation plan.

• Removes beach nourishment as an allowed mitigation

activity.

• Adds demo and rebuild as allowed.

• Up to 100% for severe repetitive loss structures, 90% for

repetitive loss and 75% for all other activities.

Page 12: Biggert waters presentation

Impact Determination Flowchart

Page 13: Biggert waters presentation

What should we be doing?

• Determine how the changes are going to affect your home

or business.

• Prepare to scrutinize remapping effort. (global warming)

• Developing maps with overlays of information from

various data bases to determine:

• Economic impact to state from premium increase dollars leaving

the state.

• Quantify affected properties.

• Quantify needed mitigation or buy out funds to determine adequacy

of federal allocation.

Page 14: Biggert waters presentation

Questions???

Page 15: Biggert waters presentation

Contact Information

•Representative Charles Busby

•House District 111

[email protected]

•228-990-2200 cell

•228-769-0501 office