The Florida Times-Union
by Kevin Turner
May 8, 2011
Thousands of Jacksonville-area residents whose homes aren’t required to have flood insurance could find themselves swamped if the area receives a direct hit from a hurricane — even a Category 1.
About 5,846 — just more than 4 percent — of Clay, Duval, Nassau and St. Johns county homes are in a “Special Flood Hazard Area” designated by the Federal Emergency Management Agency where flood insurance coverage is required if they have federally backed mortgages.
But thousands more are susceptible to surges, in which severe storms force a swell of ocean water into rivers and wetlands, forcing waterways out of their banks and into populated areas.
A direct hit from a Category 1 storm today would damage 16,246 homes and wreak $3.5 billion in damage, according to an estimate released last week. That amounts to about 10,400 homes for which flood insurance isn’t required by law, according to the report by CoreLogic, a Santa Ana, Calif.-based data and analytics company. A Category 1 storm would flood the Nassau River area, the mouth of the St. Johns River to the western end of the Trout River and the Intracoastal Waterway, as well as sections of the Jacksonville Beaches, Ponte Vedra Beach and St. Augustine.
A worst-case scenario storm surge — as much as a Category 5 hurricane could throw at the area — would send water into as much as 79 percent of all the homes on the First Coast, the report indicated.
Flood damage could climb to $19.6 billion, CoreLogic estimated, based on the values of properties that would be damaged. The most monetary damage would be in Ponte Vedra Beach, with $2.8 billion. Much of the Northside, the Westside, Nassau County, St. Augustine, Ponte Vedra Beach and the Jacksonville Beaches would be inundated with water, the report shows.
CoreLogic’s estimates for the range of storm surge damage sounds close to the mark to Steve Letro, meteorologist in charge of the National Weather Service at Jacksonville International Airport.
“The basic message they’re trying to get across is the same thing that we would probably say, ” he said.
Billions of dollars of losses likely would not be covered by traditional homeowner or commercial insurance policies. That’s because only freshwater floods triggered by rainfall are considered in FEMA flood insurance requirements, which many people don’t realize, Letro said.
“The flood insurance zones that FEMA uses have nothing to do with storm surge, ” he said. “We run into this all of the time.”
The FEMA maps account for a “100-year flood” which FEMA calculates as having a 1 percent chance of occurring in any given year. If a home’s chances of flooding are considered to be outside the 100-year probability mark, FEMA assigns it a zone “X” rating. But those zone ratings don’t take surges into account, even though rising waters from a surge could damage thousands of homes considered safe from rainfall-caused floods, Letro said.
While thousands of homeowners outside of FEMA-designated flood zones should have flood insurance, it is a difficult argument to make — especially in a down economy, said Kerry Earnest, a representative with Bacon Insurance Agency in Jacksonville.
“We haven’t had any activity since [Hurricane] Dora, ” she said. “People know that. They don’t want to spend the extra money. We have a lot of people who aren’t interested in the coverage.”
Basic homeowners insurance alone doesn’t cover “rising waters” or “wave wash, ” she explained.
Although millions saw memorable images of people awaiting rescue on the roofs of their homes New Orleans when it was struck by Hurricane Katrina, they may not know many of those homes had damage that basic homeowner policies did not cover.
“No window damage, no roof damage — just rising water, ” she said. “That’s sad.”
Flood insurance premiums for people outside the FEMA zones might cost $355 a year to cover a home and its contents, while within a FEMA zone, rates vary based on elevation, insurance representatives said. Typically, it might cost $1,200 to $1,500 a year to cover a house, but not its contents. It can cost as much as about $3,000 a year.
Usually, homeowner policies will cover damage wrought by high winds, and many seem to conclude that’s enough insurance for them.
Despite the risks, most who are outside FEMA flood zones generally pass on getting flood insurance, said Harden & Associates account manager Kim Pittman.
“They should, ” she said. “Twenty-five percent of the floods that occur [in Florida] are not in high-risk flood zones.”
Her firm recommends flood insurance for anybody who buys a home located east of the Intracoastal Waterway, for example. But because much of that area is excluded from FEMA flood zones, most of those property owners opt not to take it. The same is true for other area residents living near water, she said.
Commercial customers have the same tendency to not buy flood insurance if not required to, said Harden Vice President Jeremy Miller.
“The decision to get insurance in an ‘X’ zone [outside the FEMA-designated flood zone] is typically driven by a lender or a third-party investor outside the company, ” he said. “Our experience is that the majority do not purchase flood insurance.”
Larger companies might have their facilities insured under broader insurance programs, he said.
CoreLogic uses FEMA data and its own models for analysis about storms and floods, said Howard Botts, executive vice president and director of database development. To calculate monetary damage from storms, the company uses its data for market values of individual homes, he said.
Across the U.S., other coastal cities stand to lose more in a direct hit from a Category 5 hurricane: Long Island, N.Y. is most exposed to the risk, at $99 billion; Miami is next at $44.9 billion; Virginia Beach, Va. would lose $44.6 billion; New Orleans would lose $39 billion; Tampa would lose $27 billion; Houston would lose slightly more than Jacksonville at $20 billion. The three coastal cities that would lose less than Jacksonville in a catastrophic storm surge were Charleston, S.C., with $17.7 billion; Corpus Christi, Texas, with $4.7 billion; and Mobile, Ala., which would incur $3 billion in damage, according to the report.
