Property owners encouraged to be aware of flooding risks

LIHU‘E — The new Kaua‘i Flood Insurance Rate Maps took effect on Feb. 26, 2021.

“As far as I’m aware, there hasn’t been a change in the effective date,” said Wayne Medeiros, an agent for Pyramid Insurance located in the Kukui Grove Center. “Property owners or renters need to be aware of the risk of flooding to their homes and businesses so measures can be taken to protect their property.”

A full copy of the FIRM maps can be found at https://waihalana.hawaii.gov/flood-maps/

One of the major change is for property owners and renters who have a Federally-Backed Mortgage, and the structure is encroaching within a Special Flood Hazard Area, or any flood zone that starts with the letters “A” or “V.”

If the property meets this criteria, then the lender of the mortgage securing the property will require flood insurance as a condition of the loan pursuant to Title 42 U.S.C. 400012a(b)(1). This requirement is not a Federal Emergency Management Agency requirement, but a requirement under the federal law enforcing the lender’s Federal Regulator.

Flood insurance acquired prior to the Feb. 26, 2021 date, and keeping the National Flood Insurance Program coverage active, could have advantages for property owners affected by the new revised mapping who plan to sell their structure. The lower cost policy can be transferred to the potential buyer.

For property owners not being required to having flood insurance prior to the changes, if the revised flood maps has the property encroaching into a flood risk zone, the flood insurance could be “forced” onto the mortgage holder.

“For flood insurance, the new flood maps for Kaua‘i that took effect Feb. 26 will place some homes in a ‘high risk’ flood zone,” Medeiros said. “If the owner has a mortgage, his mortgage company will require the owner to purchase flood insurance, or they will ‘force place’ their insurance on the mortgage.”

Medeiros said that traditionally, mortgage lenders send out written notices of intent at least 30 days prior to an insurance policy being “forced placed.”

“Did you get your letter, yet?” Medeiros said. “People in the affected zones need to act quickly before being ‘forced’ to get it.”

Pyramid Insurance has access to Palomar Insurance, an insurance company that can provide flood coverage without going through the expense of obtaining a flood elevation certification prior to purchasing flood insurance through FEMA’s NFIP.

“In the majority of the cases, the Palomar Insurance flood policy has a lower premium, higher coverage limits, and there is no waiting period before the policy becomes effective,” Medeiros said.

As an example, Medeiros cited the recent rain events.

“If you secure the Palomar Insurance policy, the coverage begins on signature,” Medeiros said. “Under the NFIP policy, there is usually a wait period before the policy takes effect. This means that if an event takes place, tomorrow, the mortgage holder, or renter, is covered. No waiting.”

Renters as well as condominium owners are also able to take advantage of Palomar Insurance flood coverage as well, Medeiros said.

Additionally, for those planning on building a new structure, or improve an existing non-conforming structure where the improvements are considered “Substantial,” the Kaua‘i County floodplain management regulations require the development or improvement be compliant with the Kaua‘i County Code, Chapter 15 based on the FEMA FIRMs in effect at the time of construction.

As an example, if the area prior to the Feb. 26 map change was not in a Special Flood Hazard Area, but following Feb. 26, the area is mapped in a high risk flood zone, the developer needs to discuss the building plans with the Kaua‘i County, Department of Public Works, Building Division chief and interim floodplain manager, Doug Haigh.

For more information, the Kaua‘i County Code, Chapter 15 can be found at http://qcode.us/codes/kauaicounty/