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Posted: August 30, 2012 10:22 p.m.

Hundreds could save on flood insurance

Floods aren't a common occurrence these days in drought-stricken Georgia, but they still happen, like the 2009 flood, and certain homeowners still have to worry about flood insurance.

More than 1,000 Newton County residents are required to buy extra insurance because they own homes or other buildings that fall in a federally-designated flood hazard area, but new, more precise mapping could reduce the financial burden for hundreds of homeowners in 2013.

The new floodplain mapping won't go into effect until late 2013, after multiple public meetings, but when it does, it could save some building owners hundreds or even thousands of dollars in flood insurance payments.

Building owners who aren't located in a federally-designated floodplain don't have to buy flood insurance at all, and even if they do buy insurance, their costs are significantly lower than they those who live in a floodplain.

Scott Hubbard, a State Farm insurance agent, said there are too many factors to give a general number of how much flood insurance rates could be reduced in Newton County, but he said the majority of rates he sees are around $500, though he's seen some as high as $2,000 to $3,000. The premiums are set by the Federal Emergency Management Agency (FEMA) and aren't negotiable, Hubbard said.

"(The premium) will be much different if you're living in $600,000 house versus a $60,000 house. Even neighbors living 500 yards apart could have drastically different premiums; there are so many variables that go into calculating premiums," Hubbard said. "Where you are along the Alcovy River is going to change how much you pay from one area to the next...(Leaving the floodplain) could lead to a savings of a couple of hundred dollars or a couple thousand dollars. It all depends on where you live."

According to a preliminary analysis by Ernie Smith, a technician with the Newton County Geographic Information Systems, a net total of 445 properties with buildings would be removed from Newton County's various floodplains when the map change takes effect.

Under the current floodplain map, which was created in 2007, 1,094 parcels with buildings - homes or other structures - fall in the designated flooding boundary; that number would be reduced to 649 structures under the revised, preliminary flood boundary created this year.

While the net total of buildings will be much lower, there are some structures outside the current boundary that will soon find themselves within a floodplain, meaning some owners will see extra costs.

To see if you've been affected, check out the map at map.georgiadfirm.com and drill down to Newton County. Users have a variety of tools at their disposal, but the most useful ones will most likely be the address search and the effective flood zones and preliminary flood zones tools. The effective flood zones are the ones currently in effect, while the preliminary data shows what the zones would be once the new map is approved.

Users should be able to simply type in their address and see whether their building has been affected by the change, or they can manually scroll to any area and see if it has been affected using the other tools. The website can be prone to glitches and any changes you want to make to the map can sometimes take a while to show up.

Why flood insurance is mandated?
First of all, the vast majority of homeowner's insurance policies don't cover flood damage, so if a building owner wants financial protection against flooding, he has to buy flood insurance.

According to FEMA, floods are the most common natural disaster in the U.S. and caused nearly $2.7 billion in damage from 2001 to 2010. In a high-risk flood area - the kind of area in which FEMA requires a building owner to buy flood insurance - there is a 26 percent chance of experiencing a flood during the life of a 30-year mortgage.

Federal law requires building owners in high-risk flood areas to have flood insurance, but it's the mortgage lenders that are tasked with ensuring those owners actually do have insurance, according to Levi Bailey, a loan officer with Newton Federal Bank.

If a building owner refuses to get insurance, the banks can put forced placed coverage on a building and add the insurance payments to a owner's loan balance, Bailey said; however, the forced placed coverage generally only covers the bank's investment, not the homeowner's possessions.

Owners generally have 45 days to purchase flood insurance from the time they are notified that their building falls within a floodplain.

"A lot of the time people don't understand that it's not the banks requiring flood insurance, it's the federal government per their laws" Bailey said.

Not all mortgage lenders are diligent about requiring borrowers to have flood insurance. In the case of widespread natural disasters, the government may declare the area a disaster emergency area, in which case federal funds can then be used to help repair damage. While this may be good for the individual property owner, it also means the public is essentially providing insurance free of charge through their tax dollars.

On the flip side, even if a homeowner does not fall within a floodplain, they are still strongly considered to buy flood insurance if there is a possibility their property could ever be damaged by a flood. According to FEMA, building policies start at $20,000 and go up to $250,000, while possessions coverage starts at $8,000 and goes up to $100,000.

Safe within a floodplain
There are some circumstances under which a building owner in a floodplain would not have to have flood insurance. If the owner can prove that her building is not in danger of being damaged under flooding conditions - because of particularly high elevation or other factors - then she can receive a letter of map amendment, or LOMA.

The process requires the owner to have a study done and to send the findings along with an application to FEMA and can cost several hundred dollars. This process has to be done every time the maps are redrawn, Bailey said.

Better data, safer public
For Smith, improved floodplain mapping is a perfect example of how the incredibly powerful tools at the Geographic Information Systems department can help people in every day life.
As topography-mapping software improves, officials' ability to accurately predict events like floods will also improve.

Smith said the preliminary maps are a large improvement over the 2007 versions. The county had aerial mapping done earlier this year using Light Detection And Ranging (LiDAR) technology, which is able to accurately map land's contours.

Normally, the county would have waited a couple more years before FEMA would have agreed to use the newly-collected data to update the maps. However, given the flooding that occurred in Newton County in 2009, Smith and Newton County officials were able to successfully lobby FEMA for Newton County to get moved up in the process.

Many other communities aren't willing to invest money into such mapping programs, and that investment paid off. According to a previous story, the Newton County Board of Commissioners approved spending $20,000 for the aerial mapping, while the city of Covington and Newton County Water and Sewerage Authority spent $15,000 a piece.

After that, FEMA took over the rest of the cost to update the floodplain mapping; Newton County only had to provide in-kind services, Smith said.

"If we can removed 400 or more structures (from high-risk areas) that's a lots of savings for people," Smith said. "We help protect their and our investment and we save the citizens of Newton County more than it cost us to do this.

"We take out of equation property owners who, through no fault of own, had to pay more in flood insurance (than should have to)."

Even for those building owners whose properties remained in a floodplain, they now have a more accurate indication of which parts of their property are most likely to be affected during a storm.

Smith said the new floodplain map was a good example of cooperation at all levels of government, and through the process Newton County has made more connections with state and federal officials.

"This is what we anticipate the flood insurance rate map program to be, finally, to protect people, not afflict people," Smith said.

First public meeting
The first public meeting/training session regarding the maps will be for professionals involved in flood mapping and insurance, including mortgage lenders, casualty insurance agents and the local engineering community.

The meeting is from 8 a.m. to noon, Sept. 20 in the first floor training room in the Newton County Administration Building. In addition to an updated map, Smith said FEMA may be in the process of changing insurance rate calculations. Both a GIS and a FEMA official will be in attendance.

The county will also have an open house for all Newton County citizens, particularly those in or near a floodplain; the date for the open house will be announced later.

Those who can't tell, using the online map, whether their property will be affected under the new map are invited to call GIS; Smith said his maps are more detailed and he may be able to answer questions the online map can't.

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