BOSTON — Massachusetts is being swamped with horror stories of skyrocketing insurance premiums for homes on the water’s edge and, more recently, in adjacent areas once considered safe from flooding.
State legislators and the state’s congressional delegation say they are hearing of rates jumping by as much 1,000 percent, driven by changes in a federal insurance program and by data suggesting that more properties are at risk from rising ocean levels and climate change.
State Rep. James Cantwell, a Marshfield Democrat, says he has heard of premiums increasing as much as $60,000 per year. Other lawmakers have similar stories.
“The highest one I’ve seen was $60,000,” said U.S. Rep. Stephen Lynch, a Massachusetts Democrat. “The house was only worth $250,000. In roughly four years, you’ve basically paid for your house.”
I suppose if you’ve never lived in a flood plain, this story is just white noise. But you’d be surprised how many properties in Lowell fall inside the re-drawn flood maps. And I’m not talking about the obvious river huggers and those savages still living along Beaver Brook. I’m talking about downtown Mill Condos, or my old house that was a solid driver -three wood distance from Trull F’n Brook. That’s right, Trull Brook. That’s the moment you know the program is bull shit. In seven years, the neighborhood didn’t see a puddle big enough for Centralville kids to cross the city and play in. (The region saw 30 year floods in this period) But I still had to carry a $280/month premium.
Generally, no lender is going to approve a mortgage for a property in a flood plain without a flood insurance policy. And not surprisingly, they generally require coverage for the entire principle amount of the loan. In other words, you’re basically paying a premium to indemnify the bank, not that dirty papasan chair that’s inexplicably still in your basement mansworld.
The good news is that the flood maps don’t consider the elevation of structures on your property. If you’re not packing puddles, and are paying for a hefty policy, you may want explore obtaining a FEMA map amendment. For a few hundred dollars to hire a surveyor to shoot the elevation of your basement window, you can in all likelihood be removed from the plain via a letter of map amendment. You get to save yourself some monthly cabbage that you can spend downtown.
PS. This advice isn’t free. I charge a 3% commission, or a beer if you see me at a hockey game.