Federal Government Changing Flood Insurance Pricing Model

May 9—The federal government is overhauling the pricing model for its flood insurance program, and Frederick County residents have about three months to appeal upcoming changes to their rates.

The National Flood Insurance Program (NFIP), which provides the vast majority of flood insurance policies across the country, determines pricing by calculating a property's elevation within a flood zone. Its model has barely changed in the more than 50 years since the program was established in 1968.

Last month, the Federal Emergency Management Agency, which manages the NFIP, announced it would begin to take property value and overall flood risk into account when determining pricing, rather than solely looking at elevation data.

The changes are expected to increase premiums for about 39 percent of Maryland policyholders — more than 25,000 properties. The other 61 percent of policyholders in the state are set to see their premiums fall.

County property owners are being sent a postcard notifying them if their rates are expected to change, FEMA wrote in a statement. A 90-day public appeal and comment period began April 29, so until July 28 residents can appeal any hikes in their insurance rates "if they perceive that modeling or data used to create the map is technically or scientifically incorrect."

To prove that, FEMA said, residents must provide data supporting their claims.

The new pricing model, termed "Risk Rating 2.0," should make premiums more equitable nationwide, FEMA said. The old model meant lower-valued homeowners were "paying more than their share of the risk" while those with higher-value homes were paying "less than their share," the agency said.

Across the country, 66 percent of policyholders are set to see their premiums jump by up to $10 per month, according to FEMA. Seven percent will see increases of between $10 and $20, and 4 percent will see greater hikes. Expensive homes in coastal areas are expected to see especially significant jumps.

For years, experts have predicted that rising sea levels and increasingly frequent storms spurred by climate change could lead to soaring flood insurance premiums in high-risk areas of the country. The First Street Foundation, a group that models flood risks, predicts that premiums on high-risk homes will need to increase sevenfold by 2050 to keep up.

Frederick County residents can submit appeal requests to Zoning Administrator Tolson DeSa via email at [email protected] or by mail to the Division of Planning and Permitting, Zoning Administration, 30 North Market Street, Frederick, MD, 21701.

Once all appeals are resolved, FEMA will announce when the county's new rates will go into effect.

Follow Jillian Atelsek on Twitter: @jillian_atelsek

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