How Well Do You Know Your Flood Insurance?

There have been many changes to flood insurance in the past 2 years. Some more were just instituted last month. Have you kept up to date to see if you will be affected when its time to renew? As of April 1st, 2015 new changes were made to flood insurance where for some this will result in lower rates and more affordable insurance, for others though, the cost will be going up. These are important changes to know for your current insurance and new insurance if you are looking to purchase a new home that may be in a flood zone. If you are buying a new home check this list for some questions you should ask before making your final decision. 

If you do not live in an area that is considered a flood zone you are not required (in most cases) to obtain flood insurance. This is never recommended though. At any time a pipe could burst and cause massive destruction to your home. Most people are not aware that your homeowners insurance policy does not include damages caused by flooding. This is a separate policy you need to obtain. If you are not in a flood zone your policy will most likely not be very costly, the destruction caused by water damage is.

How you reviewed your policies lately? We encourage you to do so. If you have any questions please call us at 813.876.4166

Also, check out this quiz and test your flood insurance knowledge. Post your answers in the comments to be entered in our summer drawing.

 

  1. Is the SFHDF mandatory for all real estate-related loans?
  2. If the SFHDF form shows the property is not in a flood zone but the map indicates it is in a flood zone, which controls?
  3. Can a lender waive flood insurance on a piece of property?
  4. What happens if a lender disagrees with FEMA about a property?
  5. When is a loan considered “made” for flood insurance purposes?
  6. What evidence of coverage does a bank need to have at closing?
  7. How long does proof of coverage have to be maintained?
  8. What rules apply to second mortgage loans?
  9. Do the same rules apply for business and construction loans?
  10. Do the new Consumer Protection regulations that became effective october 1, 2001 apply to flood insurance?

 

 

 

Important Questions When Buying a Home

Buying a house is one of the biggest investments you will most likely ever make. You want to pick an area you like, see how the neighbors are, proximity to schools, hospitals and emergency services and so on. We have put together some important questions to ask your realtor and real estate broker before making the final decision.

  • Has the property been on the market for long? This is good to know for negotiation reasons. In most cases the longer the home has been on the market the more willing the sellers will be to negotiate with you.
  • Can you choose your own inspector? It is always better when you can choose your own licensed building inspector. You will get the best results and answers this way.
  • How many similar properties have sold recently? It is good for negotiations and your own knowledge to have an idea of what else has been sold, what the asking price was and what the final selling price was.
  • Are there any major issues? Is the home being sold “as is”? If that is the case the seller is not responsible for repairs. The laws vary from state to state so find out what they need to tell you and what they are responsible for.
  • Is the house in a flood zone? If you are in a flood zone you are required to have flood insurance. Due to recent changes this could be very costly so you want to find out what you are required to do and how much its going to cost.
  • Will the seller assist with costs? In some cases the seller will assist with closing costs or other fees to speed up the selling process. Your broker is not permitted to tell you how much money to offer but you can find out if the seller is flexible when it comes to this department by asking yes/no questions.
  • How motivated are they and have they had previous offers? By finding out how fast they want to sell their home and what other offers they have been given you can get a good idea of what the best offer would be.
  • Status of upgrades: Have all upgrades been done according to code and with the proper permits?

 

Reducing Household Risks with Tech

Everyone is using technology these days. We carry phones in our pocket that have more power than the first computer. What a lot of people do not realize though is that besides status updates, email and gaming, these devices can monitor home and reduce a tremendous amount of risks.

Smart home technology provides you with the ability to turn your lights on or off, monitor for fire or plumbing leaks, monitor doors and windows and more from your phone, computer or tablet. This is a great tool if you travel and really it is worth it to have in general.

The average damage caused by lightning strikes is over $25 billion a year in just North America alone. Roughly 7% of property and casualty claims are a result of this. Thanks to smart home technology you can have a whole house surge protector. Each protector is installed where electricity service enters the house. These greatly reduce the risk of damage to electronics and appliances that would most likely be ruined otherwise.

You can control the temperature while not at home. Smart thermostats can detect and control the temperature to keep your home at a preset temperature. You can also access this from your phone, computer or tablet to adjust it manually. This is great if you have pets and are not home and the weather drastically changes fast or if you want to adjust the temperature before getting home so you walk into the perfect climate.

Smart home technology can monitor leaks and other issues that may arise with the plumbing. They have the ability to shut off the system so you will not have flood damage. You can also monitor your doors and windows. You will get alerts if any door or window is opened while you are not home. This can work with your home security system as a way to further prevent burglary or theft.

All of these features are relatively easy to control once set-up and very effieicnet in protecting your home.

Flood Insurance Changes as of April 1, 2015

There are cost changes coming into effect on April 1, 2015 to flood insurance. For some this will result in lower rates and more affordable insurance, for others though, the cost will be going up. The Federal Emergency Management Agency (FEMA) will be implementing more changes to the National Flood Insurance Program (NFIP) as directed by the Homeowner Flood Insurance Affordability Act of 2014 (HFIAA) and Biggert-Waters Flood Insurance Reform Act of 2012 (Biggert-Waters).

Older homes that are not your primary residence are going to be subjected to the highest increase. The lower, subsidized rates that previously applied to these properties are being phased out and homeowners will be looking at a cost in crease of 25% plus a surcharge. The changes will also bring lower initial rates for properties that are now considered high risk due to changes in FEMA flood maps. This will last for 12 months after the changes to the maps are made and then will gradually increase to reach their full risk rate.

Some of the important Flood Insurance changes take effect in April as the result of the Homeowner Flood Insurance Affordability Act (HFIAA) and the Biggert-Waters Flood Insurance Reform Act of 2012 (Biggert-Waters):

  • Implementation of the annual surcharges that are required by the are HFIAA
  • Increasing the reserve fund assessments required by Biggert-Waters
  • Guidance on substantially damaged and substantially improved structures and additions rating guidance on Pre-Flood Insurance Rate Map (FIRM) structures
  • Implementation of the annual surcharges required by HFIAA
  • New deductible options
  • Implementation of a new procedure for Properties Newly Mapped into the Special Flood Hazard Area and existing Preferred Risk Policy Eligibility Extension (PRP) policies
  • Implementation of the first annual rate change that sets rates using rate increase limitations set by HFIAA, for individual premiums and rate classes

Federal Policy Fee (FPF) Changes

Make sure you complete and return the residency forms from your insurance company/agent, as your responses (or lack thereof) will impact your renewal rate.

If you have any questions about your current policy and what changes you may incur please call us at 813.876.4166 and one of our specialists will be on the line to help you.

To learn more about Flood Insurance you can read in detail at I Got Dropped.

Frequently Overlooked Home Costs

The main things people focus on when buying their first home is saving for a down payment, worrying about our credit and interest rate, paying the mortgage off and decorating. There are several other costs that factor into the monthly expense of a home that are frequently overlooked.

Some of the most overlooked expenses are:

  1. Homeowners InsuranceYou want to get the best coverage you can afford. If you have a mortgage most likely the broker will require a certain amount of coverage. That is to protect them in the event of a loss while they hold the title to your home. To fully protects yourself though you want to insure your homes total replacement cost, not just the market value. What this means is that you want to have enough coverage to rebuild in the event of a disaster and replacement all of your belongings inside.
  2. Flood InsuranceDepending on where you live you may need to also have flood insurance. The rates on this can vary based on the age of your home, your proximity to water and the current changes to FEMA maps. To read more about this please click here.
  3. Association Fees: Many communities and condo’s will have monthly or quarterly dues to help maintain all of the amenities you get to use while living there. Always find out about this and factor into your budget because many communities and associations will put a lean on your home if you do not stay current with these fees and it could result in a possible eviction.
  4. Repairs & Maintenance: Whether the house be older or newer, there will be times where you need to repair things and keep other’s up to date. These costs will vary depending on the economy and demand. There will be times where you need to replace major parts of the home, like the roof for example or may want to repaint your home.
  5. Upgrades: When you walk into your possible new home everything looks perfect. Then you buy, and move in and realize you want to change things. While in most cases this will add a lot of value it will also be costly depending on what you want done. Always be aware that no matter how much you love it on day one, a year later you may want to make changes.
  6. Furniture: When moving into a new home, especially if you are coming from a smaller apartment or somewhere else, it is easy to not realize that you may need to purchase items that fit the home better or fill it. This is not the most important expense but it is one to consider when purchasing a home or upgrading.