The House recently passed legislation renewing and reforming the National Flood Insurance Program. This is much needed reform, as the current plan was set to expire in a month which would severely hamper real estate sales in much of coastal Marin.
Flood insurance is required by the lender in flood zones, and a surprising amount of Marin is in a flood zone. Often some of the most desirable neighborhoods “in the flats”, such as Sycamore Park in Mill Valley, Hillview in Larkspur, and Madera Gardens in Corte Madera require flood insurance. It is tricky, as two houses right next to each other can differ, with one in the zone, the other not, depending on the elevation. And even if the house has never flooded, as is often the case, it still requires insurance. And yes, there are incidents where homes do flood, and don’t require insurance, yet other homes never do and require it.
The problem is most evident in Marin during winter rainstorms, or when we have “king tides.”
The House bill has several important changes. Most importantly, there is $1 Bllion to elevate, buy out or mitigate the riskiest properties. Amazingly, 2 percent of policies account for 25 percent of claim payments, as they repeatedly flood. As a result many homeowners are forced to pay higher rates even though their homes never flood, effectively subsidizing riskier properties.
Additionally, there are provisions that will make it easier for private insurers to step in, which will hopefully make it cheaper for homeowners, and remove some of the risk of buying in a flood zone.
Good news for Marin County, and hopefully we see more and better reforms in the next iteration of the law.