Don't Buy Flood Insurance Now and You'll Pay Later

Sacramento Flood Insurance Price Comparison

Flood Insurance will soon be mandatory in Sacramento

On January 15, 2008 the Federal announced that they are rezoning some parts of Sacramento from a preferred "X" zone to a flood hazard zone. A study conducted by the U.S. Army Corps of Engineers indicated that the levies surrounding Natomas, CA did not meet the minimum requirements of being able to withstand a 100 year flood and as a result FEMA announced that they would place Natomas in an "AE" flood zone, which is a flood hazard zone. This new zone will go into effect in December of 2008 and will essentially halt all new construction in the area as well as make it required that all properties with a federally backed loan must carry a flood insurance policy. When the final zoning maps are completed in December 2008 and parts of Sacramento are rezoned as high risk, homeowners will be required to purchase flood insurance and annual rates a Sacramento flood insurance policy will go from $317 now to approximately $1,390. That is over four times the current rate!

If you don't buy flood insurance now, you'll pay later

We all know that parts of Sacramento, such as Natomas, are in a giant flood basin. FEMA has also recognized this and has decided to reevaluate the zone designations in these areas. They have decided to rezone many areas in Sacramento in high risk flood zones. This rezoning points out two very important facts for Sacramento residents.

First it means that the levees in the Sacramento area have been deemed inadequate to protect Sacramento residents from a 100-year flood and that anyone who lives in Sacramento is in danger of serious financial hardship if they do not currently have flood insurance.
Second, it means that if you live in Sacramento, and you live in one of the areas that are rezoned to high-risk, flood insurance will be mandatory starting in December 2008. Not buying a flood insurance policy now places you and your family at risk. Best case scenario, Sacramento may not flood and in December the new zoning maps will take effect. Those residents who do not have flood insurance at the time the new maps take effect will be forced to purchase flood insurance at a high-risk rate that is more than quadruple the current Sacramento flood insurance rates. Worst case scenario residents ignore the threat of a flood and the rainy season causes the levies to fail and floods the entire area. This would put anyone who did not have a flood insurance policy into financial ruins since they would not have any insurance for their losses.

For the lowest flood insurance rate, buy now.

Anyone who purchases flood insurance before the new rezoning maps are finalized will be able to purchase a Sacramento flood insurance policy for approximately $317. Once they have purchased a policy at this lower rate, they will also be grandfathered into a lower rate for as long as they keep the policy. This could save Sacramento residents over $1,000 their first year and $1,000's for years to come. Not to mention, buying now will provide protection from the rainy season and protect you and your family from losing everything in the event of a flood. Some people will inevitably decide that flood insurance is not important to them and try to beat the system by purchasing their flood insurance right before the deadline to get grandfathered in at the lower rate. Before you decide to be one of those people consider these two things:

If you wait to purchase flood insurance you can save yourself $317 dollars today, but if the rain comes and the levies fail resulting in a massive flood you won't feel so smart when everything you own is destroyed and you didn't have any coverage because you wanted to save a few dollars.
Flood Insurance policies take 30 days to become active. Even if you purchase a week before a storm hits or a week before the rezoning in final, if it has not been 30 days you will have no coverage AND you will not get the lower rates. The only way to secure the lowest rates and to truly protect yourself is to purchase a Sacramento flood insurance policy today so you are prepared for what might happen in the future.