While MFR industry watchers debate whether the record-breaking pace of apartment rent prices will slow as year-end approaches, recent data released in the Yardi Matrix National Multifamily Report suggests that any conclusions about prices slowing down may be premature.
National Flood Insurance Program's New "Risk Rating 2.0" May Cause Problems for Builders
Olivia Rhye
11 Jan 2022
•
5 min read
With material costs soaring and natural disasters wreaking unprecedented havoc across the U.S., insurers are boosting flood insurance premiums. On October 1, the National Flood Insurance program – the main provider of flood coverage in the U.S.—rolled out a new pricing method called “Risk Rating 2.0” to more accurately reflect the flood risk individual properties face. Under the new system, some policyholders in vulnerable areas will face big premium increases, while others in less exposed areas will see smaller increases or even decreases.
With this pricing change, homeowners in more flood-prone areas are facing steep increases in their insurance premiums. For example, one homeowner in coastal St. Petersburg, Florida is looking at annual premium increase from $441 to $4,986 under the new program.
So, what does this mean for builders and investors? It means developers may need to rethink where they build, and if they do build on property that is at high risk for flooding, they should consider additions such as hurricane shutters, elevated electrical and HVAC systems, hurricane resistant garage doors and other safeguards that will help buyers save on insurance costs.
The rise of RESTful APIs has been met by a rise in tools for creating, testing, and managing them.
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Introduction
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Conclusion
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National Flood Insurance Program's New "Risk Rating 2.0" May Cause Problems for Builders
With material costs soaring and natural disasters wreaking unprecedented havoc across the U.S., insurers are boosting flood insurance premiums. On October 1, the National Flood Insurance program – the main provider of flood coverage in the U.S.—rolled out a new pricing method called “Risk Rating 2.0” to more accurately reflect the flood risk individual properties face. Under the new system, some policyholders in vulnerable areas will face big premium increases, while others in less exposed areas will see smaller increases or even decreases.
With this pricing change, homeowners in more flood-prone areas are facing steep increases in their insurance premiums. For example, one homeowner in coastal St. Petersburg, Florida is looking at annual premium increase from $441 to $4,986 under the new program.
So, what does this mean for builders and investors? It means developers may need to rethink where they build, and if they do build on property that is at high risk for flooding, they should consider additions such as hurricane shutters, elevated electrical and HVAC systems, hurricane resistant garage doors and other safeguards that will help buyers save on insurance costs.
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