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Here in the New Orleans area there are many annual rituals that most citizens dread.  Among them are getting down the Christmas decorations, boarding up for an approaching storm, the last sno-ball of the season, and seeing your insurance renewal premium increase every year.  This last item has been particularly unpleasant since the rate increases enacted after Hurricane Katrina.  Of late, flood insurance premium increases have been especially hard-hitting for property owners.  Below are some key points regarding these increases and what you can do to minimize the increase you see on your flood insurance renewal premium.

  • After Hurricane Katrina the federal flood insurance program found itself with a deficit of over $17 billion; Hurricane Sandy added another $7 billion to that deficit.
  • In order to move to a more stable financial footing Congress enacted measures to increase premiums, fees, and add variances to certain type of flood insurance policies i.e. owner occupied homes, rental dwellings and commercial properties.
  • The increased fee is $25 for owner occupied homes and $250 for all other type of properties.  Homeowners are being required to provide proof that they occupy their primary residence in order to receive the lower fee and special handling of rate increases.  If you do not provide this proof prior to issuance your renewal policy will be issued with the higher fee.
  • If the policy is issued with the higher fee you can still provide the proof and the fee will be reduced retroactively to the $25
  • For other than owner occupied residences higher fee and rate increases will apply.  On buildings built before 1974 and in a high risk "A" flood zone you may currently be receiving a subsided or "pre-firm" rate (pre-Flood Insurance Rate Map).  These policies did not require a flood elevation certificate to be written.  A flood elevation certificate or EC is a surveyors assessment of how high a particular structure is built with relationship to sea level.  You can look at your declarations page to determine this.  There would be an indication of "Pre-Firm:  Y".  If your property is rated "pre-firm" AND you are in a high risk flood zone your premium will increase 25% per year.  This increase will continue until the policy reaches actuarial rates or is re-rated with a flood elevation certificate obtained by the property owner.  These certificates usually cost between $200 and $300.  If this is the status of one of your properties I strongly suggest you secure and submit an elevation certificate as soon as possible.
  • New higher deductibles are being offered by the flood program in order to offset some of the premium increase.  Deductibles are now available up to $10,000.  Please keep in mind though that if contents are included on the policy there is a separate deductible that applies.  Losses to building and contents each have their own deductible.

I hope this information proves useful.  As always, we at Leithman-LeBoeuf Insurance are happy to answer any questions or assist you in any way possible with flood and other insurance policies.  Please feel free to call us at 504-367-7777 or write to