How Are Floodplains Determined for Homeowners?

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After Hurricane Harvey, flooding hit a lot of Texas homeowners who didn’t know they were in a floodplain – or rather, it hit homeowners who’d been told their homes weren’t in floodplains. The water damage posed a major problem because many of these people didn’t carry flood insurance.

Harvey’s damage, as well as the widespread damage from hurricanes Irma and Maria, has left people wondering how floodplains are determined for homeowners – and when a person should think about supplementing their homeowners insurance with flood insurance.

In the Beginning: FEMA’s “Base Flood” Maps

When the National Flood Insurance Program (NFIP) launched as a division of the Federal Emergency Management Agency (FEMA) in 1968, its goal was to provide a more robust insurance system for flooding that affected houses. Part of this effort involved requiring homeowners to purchase NFIP flood insurance if they lived in what was designated a “flood zone.”

Anyone who lives in an Special Flood Hazard Area is required to carry flood insurance.

The NFIP considers a “flood zone” to be any area that has a one percent chance of flooding in any given year. This one-percent chance is more commonly referred to in terms of the “hundred-year flood,” a name that many consider confusing. In fact, to prevent any confusion, the NFIP doesn’t use the term “hundred-year flood;” instead, it uses “base flood.”

If your house is located in a base flood zone (that is, in an area that has a one-percent chance of flooding in any given year), that zone is called a Special Flood Hazard Area (SFHA). Anyone who lives in an SFHA is required to carry flood insurance.

Sounds simple, right?

Inaccurate Maps, Insufficient Funding, and Private Help

The only problem was that the maps the NFIP used to determine who was in an SFHA were widely considered inaccurate. That was problematic for two major reasons:

  • People living in SFHAs that were marked as “safe” weren’t required to buy flood insurance. When floods inevitably happened, the damage was wildly expensive.

  • People living in “safe” areas incorrectly marked as SFHAs had to pay as much as 10 times what they should have for their flood insurance.

Perhaps unsurprisingly, it was this second group who ended up making the biggest fuss about the incorrect maps. In the 1980s, enough citizens complained that the NFIP decided to let private parties submit changes to the flood maps. Ideally, the NFIP would have handled these changes itself, but the organization was already suffering from insufficient funding (today, it’s about $24.6 billion in debt. Yikes).

As many as 41 million people are at inland flooding risk, compared to the 13 million FEMA currently estimates.

At first, a lot of submitted changes came from engineers working on behalf of private citizens who were tired of paying thousands of dollars for flood insurance they didn’t really need. But then developers realized that they could make some serious money by changing SFHAs to areas where it was safe to build (and sell) homes.

While many of these changes were no doubt accurate, others were… well, less so. Reports suggest that in the Houston area in particular, developers were doing things like trucking in dirt to raise the elevation of land by a few inches, adding levees, digging water retention ponds, and more. The result was that the land could technically be considered out of an SFHA – but in reality, it was still susceptible to flooding from nearby water bodies.

New Flood Maps, Bigger Risks?

The New York Times reports that more than 150,000 changes have been made to floodplain maps in the last five years, many proposed by private entities and approved by FEMA. But a study published as recently as last month suggests that current maps could be seriously underestimating the number of Americans at risk for flooding.

The reason: the new study mapped all of the continental United States, whereas the NFIP maps consider only 60 percent. With the entire landmass taken into account, as many as 41 million people are at inland flooding risk, compared to the 13 million FEMA currently estimates (both of these numbers ignore coastal flooding risks).

So… Should You Get Flood Insurance?

All this may be interesting, but it doesn’t necessarily answer the question of whether an individual homeowner should add flood insurance to their policy. If you’re on the fence, here are a few steps you can take:

  1. Read through FEMA’s FAQs on flood insurance. They cover a lot of practical ground.

  2. Price out some flood insurance quotes. Even if you’re not legally required to have it, coverage may make sense given the way climate change is impacting the intensity of storms.

  3. Protect your home. Whether or not you’re in an SFHA, shoring up your property against the biggest local hazards makes sense.