The sun was out on Thursday and a gentle breeze was blowing leaves down the hill and over the lawns that lined the quiet street near Clinton River Heritage Park in Utica.
However, Kim Maday-Apley remembers the street as a raging river.
“We had a terrible storm and there was flooding everywhere,” said Maday-Apley of Romeo, an agent for Farmers Insurance. “I wanted to see one of my clients so I went to the neighborhood but couldn’t get near the house.”
The water on the street was so high that local residents used boats to get around.
When she finally arrived home, she found her client – a divorced mother with several children – walking around her living room in waders and looking distressed.
“She was in tears. She lost everything, all the contents of the house, ”said Maday-Apley, recalling her visit after the spring storm in 2004.“ There was also a lot of structural damage.
But she had flood insurance.
She didn’t want it because it was another expense she couldn’t afford, but her house was at the foot of a hill in a floodplain and her mortgage demanded it.
She no longer lives in the house, but the accommodation still needs flood insurance, which is expected to change over the coming year.
Changes in the work
For the 20,481 Michiganders with combined $ 4 billion in flood insurance coverage through FEMA’s National Flood Insurance Program (NFIP), a federal program created in 1968 that provides 90% of flood insurance policies in the United States and provided by a network of 60 insurance companies, including Farmers Insurance, major changes in the way their monthly rates are calculated will result in increases and decreases by some policyholders based on a wider range of data sources.
Flood insurance, offered through the NFIP, covers direct physical losses caused by flooding that can cover buildings, their contents, or both, and is generally required for mortgages on properties considered to be around 1 chance in 100 each year of being inundated. , but it is also an option for anyone living in a community who participates in the NFIP program. The policies are extended to landlords, tenants and business owners. Communities participating in NFIP agree to adopt and enforce ordinances that meet or exceed FEMA requirements to reduce the risk of flooding.
Shelby Township is one of the communities in Macomb County that chose to participate in NFIP when it was first offered.
“Our participation has enabled our residents to obtain flood insurance and disaster relief,” said Tim Wood, director of Shelby Township Building, noting that to participate, the community must apply water management practices. floodplains such as discourage new construction in a floodplain. , which Shelby did.
In fact, of the 50 buildings in Shelby Township that were at risk of flooding, 40 of them were removed by landowners.
“At the end of the day, we only have 10 insurable buildings left in the floodplain,” said Wood.
As a result of the township’s efforts to exceed minimum flood prevention standards, residents are getting a 15% discount, which will be especially nice for those who might see their insurance premiums increase.
FEMA officials said the changes are needed to correct entrenched inequalities in the program, which covers about 5 million policyholders nationwide. Flood insurance rates will now be calculated using the agency’s Risk Rating 2.0 methodology, which is a longer list of factors that better reflect an individual homeowner’s flood risk.
Statewide, 9,361 current NFIP policyholders are expected to see their monthly flood insurance rates increase, while the remaining 11,120 are expected to see their premiums drop due to the methodology. According to FEMA data, the average amount of combined flood insurance coverage by the Michigan community is approximately $ 4 million.
According to FEMA, 68.5% of Michigan’s 1,773 communities are enrolled in the NFIP program, including 26 in Macomb County with a total of 1,676 insured. Federal data shows Harrison Township has the greatest coverage at $ 127.2 million, followed by St. Clair Shores with $ 98.4 million spread across town.
Of those 1,676 Macomb County policyholders, 840 are expected to see their monthly rates drop, while 836 will see a drop under the new pricing structure. Of those who will see their monthly rates increase: 797 are expected to represent an increase of between $ 1 and $ 10 per month. Other policyholders will see an increase of more than $ 10 per month.
Among the critics of the entire program is Macomb County Public Works Commissioner Candice Miller.
“The federal government shouldn’t be in the business of flood insurance,” said Miller, who believes flood insurance should be treated the same as other home insurance policies.
The former MP said she was against it from the start, saying it was created primarily for coastal communities in places like Florida, Louisiana and the Carolinas where hurricanes are common.
“We are at a significant disadvantage in Michigan,” Miller said. “We don’t have the floods they have there.”
How it works
Rate increases for existing policyholders will not take effect until after April 1, the agency said. But new flood insurance policies purchased through the NFIP will immediately be subject to the new pricing structure. However, existing policyholders whose policies are renewed before April 1 and whose premiums will decrease under the new pricing system will be able to take advantage of the lower rates sooner.
Brandon Lewis, director of emergency management and communications for Macomb County, said the floodplain maps will not change.
Only the methodology used to calculate flood insurance rates will be reviewed.
“Other than to say it’s going to put some families and homeowners in a difficult position, I don’t know the methodology enough to say if it’s good or bad,” Lewis said.
What he does know is that the new technology will provide FEMA with a more precise determination of risk factors.
Since the 1970s, flood insurance rates have been based on a limited number of data sources and were primarily determined by a property’s proximity to a federally approved floodplain and its elevation based on the risk of flooding over 100 years. Under the old pricing system, each insured would have seen their rates increase now and in the future.
The new rates will now be based on an expanded set of data sources, including home value and cost of reconstruction as well as several others to determine a property’s true flood risk, including the threat of flooding. extreme precipitation events, climate change, distance from water body, flood type, ground elevation and other property specific data such as foundation / construction type and first floor height.
“All of these things work together to determine risk,” Lewis said, allowing FEMA to provide more accurate pricing based on the individual characteristics of a property.
Matthew Occhipinti, Michigan’s NFIP coordinator and floodplain engineer for the Michigan Department of the Environment, Great Lakes, and Energy (EGLE), said the new pricing system would not affect the number of owners, tenants or business owners eligible for flood insurance.
“I think FEMA has known for a long time that it needs to update the way it calculates rates,” he said, adding that for those who see their flood insurance premiums increase, they don’t. not going to jump like they would. have under the legacy pricing system. “This new methodology takes a more granular approach, so your rate will depend on many different factors, so site specific details will matter.”
Flooding can happen anywhere and a single inch of flood water can cause up to $ 25,000 in damage.
As an insurance agent for over 25 years, Maday-Apley knows that most people aren’t happy when they need flood insurance. But, as with fire insurance, she saw what the police can mean in a disaster.
“I was so happy she got it,” Maday-Apley said of the single mother affected in 2004 in Utica. “Everything she lost was covered.”
For more information on NFIP, visit floodsmart.gov/ or fema.gov/flood-insurance/risk-rating/profiles