Flood coverage needs separate insurance

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In the wake of September's record rain and subsequent flooding, interest in flood insurance is rising. Property anywhere in Socorro County can be insured against flood damage, because the entire county is now a participating community in the National Flood Insurance Program (NFIP), a federal program managed and subsidized by the Federal Emergency Management Agency.

In the wake of September's record rain and subsequent flooding, interest in flood insurance is rising. Property anywhere in Socorro County can be insured against flood damage, because the entire county is now a participating community in the National Flood Insurance Program (NFIP), a federal program managed and subsidized by the Federal Emergency Management Agency.

Flood damage is not covered by standard property insurance policies and not required by lenders if the property is not located in a FEMA-designated flood zone, according to Christine Shaffner with Socorro Insurance Mart. Home and business owners purchase flood insurance separately, either through commercial underwriters or through the NFIP. Persons seeking federally backed home owner's property insurance must have flood coverage in place, according to FEMA spokesperson Jacqueline Chandler.

City flood plain manager Mike Czosnek advises all property owners in flood hazard areas to get flood insurance. Without NFIP coverage, FEMA will not provide disaster relief.

Shaffner has written many flood insurance policies in Socorro, and is currently working with a homeowner on a claim related to September's storms.

"There's only one claim on-going right now from the rains that we had," she said. "The property owner and FEMA are still negotiating. The loss was within the city limits. They had a valid policy in place. It appeared to be pooling from runoff."

Shaffner said flood insurance is worth considering even if a property is not in a designated flood zone. She has her own home insured against flood damage.

"You can get flooded anywhere," she said. "My house is lower than the street. In the event of a catastrophic rain, it could very well come down the driveway and flood my house."

City of Socorro and village of Magdalena's flood insurance premiums are based on accurate flood hazard zone maps already in place, but the just-completed county flood risk rate map is awaiting FEMA approval.

"The city and the village of Magdalena have had maps showing flood hazards since the 1980s," Czosnek said. "The current defined flood zone area (in the city of Socorro) is primarily east of the interstate, and as far west as El Camino Real. Once again, we're talking of the base flood elevations based on the contours of the land. Certain areas are going to be lower."

According to Chandler, parts of Socorro and Magdalena have A, AE, and X flood hazard designations.

"Zones A and AE are considered special flood hazard areas and have a higher (flood) rate based on flood risk," Chandler wrote in an email.

A preliminary flood hazard map was created for the entire county in 2011, Chandler said, but has not been approved yet. Czosnek said approval depends upon FEMA's certifying the city's diversion channel levees, structures that have been in place since the 1960s. The Middle Rio Grande Conservancy District and the U. S. Corps of Engineers may begin replacing existing spoil banks with engineered levees required by FEMA on the west side of the Rio Grande from the diversion channel south to Otero Avenue as early as 2014, according to Subhas Shah, MRGCD chief engineer. This phase — one of several to be constructed from San Acacia dam to San Marcial — should be completed within a year. Flood mitigation structures such as FEMA-approved levees alter the flood risk rate for areas protected by them. Czosnek thinks the revised county flood risk maps won't be approved until early 2015.

Until then, flood insurance premiums for some properties may be artificially low, because not all flood hazard zones have been officially identified or updated. Many possibly hazardous areas are currently labeled as non-hazardous Zone X for lack of better data.

"The unincorporated areas of Socorro County currently have no effective flood insurance rate maps, which is what flood insurance is based on," Chandler wrote in an email. "These areas are considered X zones – or a low risk area."

"Any homeowner in the county can obtain flood insurance at a low rate right now," Czosnek said.

The current rates are low not only because the county flood risk map has not been approved, but also because the federal government is paying part of the premium.

"Homes located in a high-risk flood zone and built before the first flood insurance rate map became effective…may currently be receiving subsidized flood insurance premium rates," according to the NFIP website. The federal government's flood insurance program has incurred huge losses in the past few years, and may have to pass on some of those costs to consumers.

"NFIP is struggling right now," Shaffner said. "They're increasing flood insurance rates next year. They've taken some tremendous hits with hurricanes (Katrina and Sandy) so they have to make some changes."

According to Shaffner, yearly flood insurance premiums now vary from a few hundred to a couple of thousand dollars a year.

"Current rates for low-risk areas like my home in Zone X costs $355 per year (for $250,000 coverage), but in the high-risk Zone AE, you could be paying as much as $2,500 per year for $250,000 in coverage depending upon the zone, construction materials, deductible, and if you have an elevation certificate and your building is above the flood plain."

By city statute, all new construction within the city limits must have a certified flood elevation survey in place before and after the structure is built to assure that the finished ground floor is above the projected flood level for that area, Czosnek said. Property owners who fail to get the survey are in violation of the ordinance and are cited into Municipal Court. They face a possible fine of up to $300, although no one to date has been fined.

County flood plain manager Mark Mercer said property owners in unincorporated areas of the county (or those considering buying property outside of the city) can contact him to get a current flood hazard rating for their property's location. The preliminary FEMA flood insurance rate map can be accessed online; most lenders already require flood insurance based on hazards identified on that map. Mercer said checking with him will help property owners estimate the cost of flood insurance and other liabilities incurred by building in a flood zone.