Local governments have a free online insurance policy in Flagstaff

Coconino County and the City of Flagstaff hosted a free website Monday evening to provide information on how to get flood insurance amid what county officials called “severe and repeated flooding” in the area.

The webinar included an overview of the National Flood Insurance Program (NFIP) from Federal Emergency Management Agency (FEMA) representative Edie Lohmann and a special insurance plan from Bruce Bender of Bender Consulting Services.

The full recording of the webinar can be found on Coconino County’s YouTube channel, but an analysis of its content is listed below.

“Historically, to this day, we know that floods kill a lot of people and cause property damage all over the country,” Lohmann said at the launch of the NFIP, which he described as “a major federal program” established in 1968 to provide water. flood. insurance where private insurers would not.

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According to Lohmann, the NFIP “works” because “FEMA agrees to make flood insurance available to the community when the community agrees to follow and enforce water management regulations.”

Through the NFIP, “anyone who wants a policy can buy it,” Lohmann said. “NFIP does not deny coverage.”

Areas that do “substantial” amounts of flood control to qualify for the NFIP are eligible for exemptions based on the “public accounting system,” Lohmann said.

Both Coconino County and the city have chosen to participate in the regulatory system. Coconino County is rated class 8 and receives a 10% discount on NFIP premiums – saving policyholders $16,893 per year. The city of Flagstaff is rated a class 5 and receives a 25% discount – saving points holders $85,512 statewide.

“That’s good practice,” Lohmann said. “A big shout out to Coconino County and the City of Flagstaff for getting involved and going above and beyond the call of duty.”

Lohmann explained that the NFIP covers damage caused by flooding in areas that are usually dry, as well as “muddy” streams of mud and debris that flow through dry areas.

“We cover mud, but we don’t cover other types of earth movements,” Lohmann said. “For example, landslides, slope failure, land mass.”

The differences between the types of movement can be difficult for people to discern, Lohmann added.

“For our purposes here, I want you to think of the mud as a rib of milk. If you try to shovel mud, it comes out of the end of your shovel against some kind of earth movement where you dig the shovel, and it becomes sticky dirt that sticks to the shovel and doesn’t come off; ” he said.

NFIP policies cover “everything inside the home — the foundation, the utility connections — the things in the home that you can’t take with you when you move,” Lohmann said. “Most of the time, you can summarize it as the foundation, the frame of the building, the machinery and equipment that supports the building. What it doesn’t cover are the external things – landscaping, pools, things like that.”

He added that there is “a lot” of information available in the NFIP regulations, but that coverage is not uniform.

There are more statutory provisions under the NFIP plan enacted by Congress, Lohmann said.

“For a residential home, you can purchase up to $250,000 for the home with up to $100,000 in contents. For commercial homes, up to $500,000 for the home and $500,000 for the contents.”

Most NFIP policies have a 30-day waiting period, Lohmann said, with a few exceptions — when the policy is requested by a lender in connection with a new, government-backed loan, in the event of a FEMA flood map and after—except for a wildfire.

“When there is a flood on federal land that has been extended by a wildfire, and the property owner purchased an NFIP policy before the fire or within 60 days after the date of the fire, then the property owner is inundated during the time they could have. It is usually their waiting period. 30 days, the owner can be pregnant for one day,” said Lohmann. “The NFIP determines post-wildfire eligibility on a case-by-case basis.”

According to Lohmann, the criteria for waiving the 30-day waiting period “are very specific in the law.”

“FEMA does not have the right or authority to withdraw information under federal law as provided,” he said.

Flood insurance is covered by the homeowner if the property falls into a flood hazard zone, which can be identified by looking at available FEMA flood maps. msc.fema.gov.

“FEMA’s flood maps are a snapshot in time,” Lohmann said, adding that they need to be updated through two to five management cycles.

“The only thing that can be said is that it doesn’t show changes that happen immediately, like wildfires. We don’t have that ability in mapping,” he said.

NFIP policies can be purchased through local insurance agents. If a person does not have an established relationship with an insurance provider, the NFIP has a toll-free number to contact people they know better when writing NFIP policies.

“Insurers writing NFIP policies are all using the same system to read and write policies,” Lohmann said. “If you go to 10 different providers, you should get the same quote when you use NFIP.”

The wording in the text was based on a recently revised formula, Lohmann said.

The main factors to measure include the location of the floodplain, elevation, construction and type of foundation, replacement cost and more. These things are counted together “suddenly.”

Lohmann said that while the new accounting system is “faster” than the previous one, it is “not flexible enough to adapt to the latest developments like wildfires.”

Private insurance remains an NFIP alternative, Bender said, but it can sometimes be “confusing,” because private insurance companies sell NFIP-backed policies. Bender explained that, recently, many insurance providers did not want to take the risk of flood insurance.

“But as information has progressed, we’ve seen as many as 50 programs in the US,” he said.

According to Bender, there are two types of private insurance programs: accredited and non-accredited companies. Licensed companies must “file their rates and forms with the insurance department and be approved for registration in the state.” Illegals don’t have to do this, but “if they go pregnant and can’t pay the debt because they’ve lost a lot, they don’t have the chance to get the money to guarantee the government.”

Basic types

There are four basic types of flood insurance, according to Bender. The first is the actual NFIP policy. The second would be the “variation of nature” policy that can increase the homeowner’s insurance for events such as floods, earthquakes and even volcanoes. The third is the “homeowner’s plus” policy which is “in addition” to the homeowner’s policy, and the fourth is the “NFIP plus policy” which is similar but “more” than the NFIP.

Coverage means coverage in excess of the $250,000 limit established by NFIP policies, Bender explained, with construction limits up to $5 million, contents up to $2.5 million and general insurance limits up to $20 million.

“Greater learning than NFIP is offering,” Bender said.

Private policies can also be easier to cancel than NFIP policies, which often have a zero to seven-day waiting period and can support additional payment options, such as moving expenses or out-of-state expenses, Bender said.

“The costs can be lower and they can provide better coverage than the NFIP,” Bender said.

Private autos, however, have their own insurance policies, can reimburse quotes, don’t need policy renewals, and policyholders’ claims are not protected in the event of a policy failure.

There are also issues related to the trade-off between NFIP and private insurance if private insurance doesn’t work anymore, Bender warned.

If someone starts with NFIP, switches to private coverage and tries to return to NFIP, it’s considered a “lapse,” Bender said, adding that the move would prevent a policyholder from waiving what they might have under their original NFIP plan.

“You’re going to be at full risk,” he said. “And when you do remember that the NFIP has a 30-day waiting period.”

He also encouraged homeowners who are interested in private equity to talk to their mortgage lenders about getting approved first.

To learn more about NFIP policies, go to www.FloodSmart.gov or call 1-877-336-2627.

To learn more about flood insurance, visit www.coconino.az.gov/2168/Flood-Insurance-Information.

Flood information for Coconino County and the City of Flagstaff is available at www.coconino.az.gov/1450/Flood-Control-District and to www.flagstaff.az.gov/4315/Flood-Information.