Pre-FIRM and Insurance (how much, houses, buying)

[Tujuleez1]

From what I understand, any home in PG built before 10/30/70 is considered to be Pre-FIRM and is supposed to be grandfathered when it comes to insurance rates. I don't know how that would affect those rates. I heard one man claim he paid $500/yr in flood insurance because his house was Pre-FIRM grandfathered and would be paying $3K if it wasn't.

I read something to the effect if your home is improved 50% over what it was, the home loses its Pre-FIRM status. I don't know if that 50% means from the FIRM date or 50% from what it is at any given time.

How can you determine if an older home is Pre-FIRM?

Would this status lower your insurance rates? If so, by about how much?

I've been searching the Internet for answers but have hit a dead end with these questions. Anyone have an idea?

[MartyGras]

Every property is different.

If the property your interested in is pre firm and the current owner has flood insurance then the property will be grandfathered, however if the current owner does not have flood insurance then you will not be grandfathered in and you will pay dearly.

There are many factors that determine how much your flood insurance cost would be but the most important are your houses height above or below base flood elevation and the value of the house.

I can tell you that my house is not pre firm and my insurance costs is nowhere near $3k... Not even close.

The only person I can tell you for sure what the insurance cost would be is an insurance agent if you're able to supply them with a base elevation certificate ( flood certificate )for the house you're looking at. Sometimes the owner has a flood certificate and occasionally the county has them on file. If not the only way is to have a survey company do a survey and prepare one for you.

Gary

[wpc691]

The FEMA 50% rule says that if a structure below BFE is damaged or remodeled in excess of 50% of its value, then it must be brought completely up to all current codes. The assessment is made by FEMA, not you, and will use contractor rates, not you doing the work yourself. That's why there are so many empty lots in otherwise built-up areas - homes damaged by Charley that were below BFE were knocked down and never rebuilt because insurance covered only the actual damage, not the additional cost of building completely new to code. This can obviously be a real trap, and calls for extra caution. Having your below-BFE house completely destroyed by a hurricane is unlikely - what's more likely (though still low probability)is your house will be half destroyed by a hurricane, and half destroyed by FEMA. If you're not in a position to simply walk away from a damaged house, you should spend some serious time with an insurance agent and ask lots of hard questions.

[Tujuleez1]

Thank you for the replies. This is new territory for us and the search for reliable answers is challenging, to say the least.

Gary, do you know if the present owner were to get insurance and bind it, would the grandfather clause kick in for the new owners or would the property need to have a continuously unbroken record of being insured for flood?

We don't yet have the Elevation Certificate. That should be completed this week. The home inspector said the house was built with a foundation wall upon which the slab was poured and that put the slab of the house higher. I'm hoping he's right. What started off with estimates for total insurance being around $3500 is now being pushed to almost $6000. I also learned the taxes could jump from what they are now because of Save Our Homes. I'm getting worried.

[wpc691]

Originally Posted by Tujuleez1

Thank you for the replies. This is new territory for us and the search for reliable answers is challenging, to say the least.

Gary, do you know if the present owner were to get insurance and bind it, would the grandfather clause kick in for the new owners or would the property need to have a continuously unbroken record of being insured for flood?

We don't yet have the Elevation Certificate. That should be completed this week. The home inspector said the house was built with a foundation wall upon which the slab was poured and that put the slab of the house higher. I'm hoping he's right. What started off with estimates for total insurance being around $3500 is now being pushed to almost $6000. I also learned the taxes could jump from what they are now because of Save Our Homes. I'm getting worried.

Wayyyy better to find out now rather than after closing.

Remember that grandfathering almost went away recently, and theoretically could at any time.

[MartyGras]

Originally Posted by Tujuleez1

Thank you for the replies. This is new territory for us and the search for reliable answers is challenging, to say the least.

Gary, do you know if the present owner were to get insurance and bind it, would the grandfather clause kick in for the new owners or would the property need to have a continuously unbroken record of being insured for flood?

From what I understand the coverage needs to have been continues. But again this is a question for your insurance agent.

You also need to know that the cost of insurance on a prefirm house is going to increase yearly at a higher rate than a post firm house.

Gary

[wjereb]

Sorry to hijack the thread but what exactly is base flood elevation?

Bill J

[JERSEY MAN]

Base flood elevation is the single most important concern one should have when buying a waterfront home. If the BFE of a home is below the FEMA requirements for the area, you are screwed when it comes to insurance, selling, remodeling after a flood and so forth.

[wpc691]

A home has both a BFE (Base Flood Elevation) and its own elevation. The BFE for an area is determined by FEMA, and is something like height of water above mean sea level during a hundred year flood - the exact definition doesn't matter, just know what it is where you're buying (it should appear on a survey). The elevation of the home is how far the main living area is above sea level. If it's over the current BFE, no problem ( of course you could still get flooded). If it's below BFE, start asking questions and thinking about the risks. If you don't care about, or can accept the risks, no sweat. If you're very concerned about flooding, insurance, etc, maybe a waterfront home isn't the right choice - there are lots of homes in PG and PC that are not in flood zones.

[SandyJet]

I have a grandfathered primary house that is zone AE but I pay as if I am zone X. I pay Full flood $500 a year with a basement

Full Risk is like $3,000 a year. My risk is if I am 50 percent damaged or improved or considered a repetitive flood property I get thrown out of cheap insurance and into full risk and if I dont raise I get slapped with fines from building dept and may lose my CO.