Flood Insurance for Your Outer Banks Home

Flood-Insurance-for-Your-Outer-Banks-HomeIf you are a first time homeowner or just new to the Outer Banks; perhaps you are not aware that flooding is not a hazard covered under your homeowners insurance. In fact, typically, flood coverage is not covered under any homeowners’ policy.

Depending on your location in the Outer Banks, you may be required by your mortgage company to carry flood insurance. However, even if you are not required to carry flood insurance, it is prudent to do so anyway. A flood can happen anywhere. Just because your property has not flooded in the past is no guarantee that it will not happen in the future. Nearly 20% of flood insurance claims occur in low to moderate risk areas. The typical loss due to flooding is over $30,000. There is a 30 day waiting period before a flood policy becomes effective.

The definition of a flood, according to the National Flood Insurance Program, “is a general and temporary condition where two or more acres of normally dry land or two or more properties are inundated by water or mudflow. Many conditions can result in a flood: hurricanes, overtopped levees, outdated or clogged drainage systems and rapid accumulation of rainfall.”

Understand your Risk – Start With the Maps

The FIRM (Flood Insurance Rate Maps) specify the level of flood risk for a given property. There are 3 categories: high-risk, moderate-to-low risk and undetermined-risk areas. As with all insurance, the lower the risk of a claim the lower the premium amount for coverage. Use this link to find map for your property address to determine your level of risk. Keep in mind, even in high risk areas, the premium cost for flood insurance is rather small. Also, the maps are revised periodically as conditions and other factors change.

High Risk Areas
A high risk area or Special Flood Hazard Area (SFHA) has a 25% chance of flooding during a 30-year mortgage. As mentioned earlier, homes and business owners in these designated areas with mortgages from federally regulated or insured lenders are required to buy flood insurance. They are shown on the flood maps as zones labeled with the letters A or V.

Moderate- to Low-Risk Areas
A moderate to low risk area is known as Non-special Flood Hazard Area (NSFA) and while the risk is lower, it is not totally eliminated. In fact, these areas incur over 20% of NFIP claims and receive one-third of disaster assistance for flooding. These area are shown on flood maps as zones labeled with the letters B, C or X (or a shaded X).

Undetermined Risk Areas

The third category is “undetermined” because no analysis has been conducted in these areas. Typically, these zones are located in less populated areas. Just because it has not been studied does not mean there is no risk of flooding. Flood insurance rates reflect the uncertainty of the flood risk. These areas are shown on the flood maps with the letter D.

Community Rating System (CRS)

The CRS is a National Flood Insurance Program’s (NFIP’s) voluntary program for communities to implement flood protection activities that exceed Federal minimums. In exchange, members of the community reduce their risks from flooding and earn a discount on the flood insurance premium.

Communities in the program earn credit points that correspond to different levels of discounts. There are 10 CRS Classes – Class 1 is the highest level with largest flood insurance premium discount (45 percent) and Class 10 is the lowest level with no participation in the CRS program and no insurance premium discount. The CRS Classes earn credits in 4 categories: Public Information, Mapping and Regulations, Flood Damage Reduction, and Warning / Response.

Over than 1,200 communities in all 50 states participate in the Community Rating System (CRS). There is only one Class 1 community in Roseville, CA. More than 70 communities have a CRS Class 5 or better ranking, meaning premiums for residents in high-risk areas are reduced by at least 25 percent. The table below includes the rating for the Outer Banks area. Click here to view a list of all FEMA CRS communities, including Class rankings and insurance premium reductions.

COMMUNITY NUMBER

COMMUNITY NAME

CRS ENTRY DATE

CURRENT EFFECTIVE DATE

CURRENT CLASS

% DISCOUNT FOR SFHA1

% DISCOUNT FOR NON-SFHA

370078

Currituck County

10/1/93

05/1/08

8

10

5

375348

Dare County

10/1/91

05/1/08

8

10

5

370632

Town of Duck

10/1/11

10/1/11

7

15

5

375353

Kill Devil Hills

10/1/91

10/1/11

6

20

10

370439

Kitty Hawk

10/1/91

10/1/02

6

20

10

375356

Nags Head

10/1/91

10/1/01

6

20

10

370430

Southern Shores

10/1/92

10/1/11

7

15

5

How to Read the Maps

Base Flood Elevation, Special Flood Hazard Area

The Base Flood Elevation (BFE) is the height that flood waters are expected to rise during a base flood event. A base flood event has a 1% annual chance of occurring or an event that occurs 1 in 100 years. Base Flood Elevations, usually rounded to the nearest whole foot, are shown on the flood map in areas where there has been a detailed study.

Flood hazard areas identified on the Flood Insurance Rate Map are identified as a Special Flood Hazard Area (SFHA). SFHAs are labeled as Zone A, Zone AO, Zone AH, Zones A1-A30, Zone AE, Zone A99, Zone AR, Zone AR/AE, Zone AR/AO, Zone AR/A1-A30, Zone AR/A, Zone V, Zone VE, and Zones V1-V30.

Moderate flood hazard areas, labeled Zone B or Zone X (shaded) are also shown on the FIRM, and are the areas between the limits of the base flood and the 0.2-percent-annual-chance (or 500-year) flood. The areas of minimal flood hazard, which are the areas outside the SFHA and higher than the elevation of the 0.2-percent-annual-chance flood, are labeled Zone C or Zone X (unshaded). An example map in Southern Shores appears below.

One can’t live so close to the sound and the ocean without being aware of the risk of flooding either from hurricanes, nor’easters or other events. Let Eillu help you navigate local waters whether you are buying a home, selling a primary home, a vacation home; or just want to test the waters. We know the local Outer Banks real estate market and will keep you from running aground!

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