Progress Report on New Flood Maps and Flood-Insurance-Risk Ratings

On June 29, 2021, Harris County Flood Control District (HCFCD) gave Commissioners an update on the progress of new flood maps and flood-insurance-risk ratings. The flood-map changes could become effective as early as late 2023. FEMA’s new Risk Rating 2.0 system for flood-insurance pricing will be phased in during the next few years. See details below.

MAAPnext About Half Complete

MAAPnext is Harris County’s Modeling, Assessment and Awareness Project. The purpose: to develop the next generation of flood maps and tools. It will provide a better assessment of flood risks for individual properties, and make the nature of those risks easier for property owners to understand.

One of the significant changes: the new maps will capture different types of flooding, such as street flooding. This is currently the biggest missing piece of the flood-risk rating picture, according to the MAAPnext project team.

The new maps will also come with individual property reports that estimate flood depth, water-surface elevations, annual-chance of flooding grids, and 30-year chance of flooding grids. That last will estimate your chance of flooding at least once during a 30-year mortgage. The flood map grids will also be more detailed. They will provide estimates down to the 3 ft X 3 ft level.

FEMA and Harris County expect to have:

Draft flood-risk maps and associated data available for public review by the end of this year.
Preliminary Flood Insurance Rate Maps (FIRMs) for release by next summer.
Public meetings to review and explain the FIRMs to officials and residents during the second half of next year.

The earliest likely date that the new rate maps could become effective: late 2023.

Changes to flood-insurance premiums as a result of map changes could only happen after the new maps become effective.

Understanding FEMA’s Risk Rating 2.0

Risk Rating 2.0 is a massive FEMA effort to put the National Flood Insurance Program (NFIP) on a sound actuarial footing.

FEMA is updating the National Flood Insurance Program‘s (NFIP) risk rating methodology through the implementation of a new pricing methodology called Risk Rating 2.0. The methodology leverages industry best practices and cutting-edge technology to enable FEMA to deliver rates that are actuarily sound, equitable, easier to understand and better reflect a property’s flood risk.

More Risk Factors Considered

Elevations, flood-hazard zones, and rating tables will no longer be the only metrics used in calculating the flood-insurance premium for a property. For example, premiums will be distributed across all policyholders based on home values and a property’s unique flood risk. FEMA will also consider flood frequency, multiple flood types—river overflow, storm surge, coastal erosion and heavy rainfall—and distance to a water source along with property characteristics such as elevation and the cost to rebuild.

More Equitable Rates

Currently, many policyholders with lower-value homes are paying more than they should and policyholders with higher-value homes are paying less than they should.

That said, FEMA expects 87% of single-family homes to see a flood-insurance-premium increase of about $120 per year. Another 4% could see an increase of about $121 to $360 per year. Finally, 9% could see a decrease of up to $1,200 per year.

*Source: FEMA Fact Sheet – County-Level Premium Change Analysis* *reproduced in HCFCD document*

Phased Implementation

Beginning October 1 this year:

New policy holders will be subject to the new rates.
Current policy holders eligible for renewal can take advantage of premium decreases.

Starting in April 2022:

Existing policy holders who expect an increase with the new method could renew under Risk Rating 2.0, but will have an option to keep their current policies if cheaper for up to two years.
All remaining policies renewing on or after April 1, 2022, will be subject to the new rating methodology.

Contact your flood insurance agent to clarify all timing, rate and discount questions.

How Does MAAPnext Factor into Risk Rating 2.0?

Harris County Flood Control District in partnership with FEMA lead the MAAPnext effort to revise flood insurance rate maps. FEMA alone leads the Risk Rating 2.0 effort to calculate new flood insurance rates. The maps will help calculate new premiums.

For more information, visit the MAAPnext website or the Risk Rating 2.0 section of FEMA’s.

Posted by Bob Rehak on July 4, 2021 based on information from HCFCD and FEMA

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