What New Flood Insurance Rates Mean for PA Residents

What New Flood Insurance Rates Mean for PA Residents

FEMA has announced a new rating system for its flood insurance program, called Risk Rating 2.0: Equity in Action. The new system represents a significant overhaul and will result in rates that more accurately reflect risks for each individual property.

Flood insurance premiums for two properties in the same flood zone may no longer cost the same. More variables will be considered, including construction type, first-floor height, ground elevation, building replacement cost, and distance to a river or coast. The new framework should result in fairer pricing and prevent owners of less expensive homes from paying more than their share compared with owners of more expensive homes.

What Does This Mean for Pennsylvania?

If you’ve purchased flood insurance for your home, your insurance cost may change. In Pennsylvania, 63% of policyholders can expect a premium increase of up to $20 per month, 7% will see an increase of more than $20 per month, and 30% can expect their premium to decrease.*

You can access flood maps for specific properties using FEMA’s online Flood Map Service Center. If you’re planning to buy a home, consider electing the “Property and Flood Insurance Contingency” as part of your offer, especially if the home is in a flood zone or close to a creek or river. Finding out up front whether flood insurance is required and what the cost will be can save you from disappointment later on.

*Data from FEMA’s presentation to the Pennsylvania Association of Realtors.

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FOR EXPERT ADVICE buying or selling a home, contact Annette Nelson at (610) 247-7892 or annette@preferredhomes.com

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