Elevating a structure can prevent or significantly
reduce flood damage. Properly elevated and constructed, a raised
floor foundation can help keep a home far above flood waters.
In addition, a raised floor can provide significant savings
in flood insurance premiums as shown in Table
2.
Many homeowners have incorrectly assessed flood risks to their
property. The Federal Emergency Management Agency (FEMA) estimates
that 10 million households are located in flood-prone areas.
But between 20% and 25% of all flood insurance claims are paid
to people living outside the high-risk areas. According to FEMA,
there is a 26% chance of experiencing a flood during the life
of a 30-year mortgage compared to a 4% chance of fire.
In the face of mounting flood losses and escalating costs to
taxpayers for disaster relief, Congress created the National
Flood Insurance Program (NFIP) in 1968.
The federal government
makes flood insurance available to NFIP participating communities
that adopt and enforce ordinances to reduce future flood risks.
This insurance is available to all owners of insurable structures
whether in or outside the floodplain.
It is the task of FEMA to identify and map flood hazards nationwide.
Flood Insurance Rate Maps (FIRMs) distinguish several flood
hazard zones, including the Special Flood Hazard Area, defined
as an area inundated by a flood that has a 1% chance of being
equaled or exceeded in any year. This benchmark is also called
the Base Flood Elevation, or BFE. The fundamental NFIP requirement
for every participating community is that any new or substantially
improved residential building must have its lowest floor elevated
to or above the BFE on the FIRM.
By elevating a home to meet NFIP requirements, a property owner
can reduce the annual flood insurance premium by hundreds of
dollars. The higher the floor elevation, the lower the flood
insurance premium. Over the life of a mortgage, this can result
in significant savings. See Table 2 and
Table 3. However, elevating to or above
the BFE does not eliminate the requirement to purchase flood
insurance in a Special Flood Hazard Area.
Considering other options — slab atop dirt fill or slab
on a backfilled perimeter wall — the raised floor may be the
most practical and cost-effective way to protect your property
and meet local building ordinances in flood-prone areas. Regardless
of the foundation you choose, raising the floor to (or above)
BFE can help avoid costly mitigation measures such as relocation,
demolition, or rehabilitation in the aftermath of a flood.
For more information on flood risk and flood insurance, visit
www.fema.gov.
Reduce Flood Risk and Insurance Premiums with a Practical
Raised Floor
There are substantial savings in annual flood insurance premiums
when a home is raised above the base flood elevation (BFE),
as Table 2 illustrates. Actual savings
could be even greater because the Federal Emergency Management
Agency expects flood insurance premiums to increase 5% per year
to cover anticipated flood claims.
Table
2 Annual Flood Insurance Premiums¹
SINGLE-STORY
RESIDENTIAL CONSTRUCTION
MULTI-STORY
RESIDENTIAL CONSTRUCTION
Dwelling Value
At BFE²
Plus 1 foot³
Plus 2 feet³
Plus 3 feet³
At BFE²
Plus 1 foot³
Plus 2 feet³
Plus 3 feet³
$ 75,000
$727
$461
$299
$264
$537
$330
$299
$264
$100,000
$747
$481
$319
$284
$557
$350
$319
$284
$125,000
$767
$501
$339
$304
$577
$370
$339
$304
$150,000
$787
$521
$359
$324
$597
$390
$359
$324
$175,000
$807
$541
$379
$344
$617
$410
$379
$344
$200,000
$827
$561
$399
$364
$637
$430
$399
$364
$225,000
$847
$581
$419
$384
$657
$450
$419
$384
$250,000
$865
$599
$437
$402
$675
$468
$437
$402
Source: Table provided by Alpha
Insurance LLC, Gretna, Louisiana (www.alphala.com)
1 National, unadjusted rates for Flood Zone A. Includes $30
policy fee.
2 BFE is Base Flood Elevation or the elevation that a flood
will reach with a 1% probability any given year.
3 Plus 1 foot means the living area floor elevation is at least
6 inches above BFE; Plus 2 feet means at least 18 inches above
BFE; and Plus 3 feet means at least 30 inches above BFE.
The 2,744 sq. ft. footprint of this two-story custom home
was used as the basis for the foundation cost comparisons
in Table 1, and for calculating
foundation + flood insurance costs in Table
3. The footprint includes the porches, but not the
garage.
A Raised Floor More than Pays for Itself over a 30-Year Mortgage .
In a flood hazard area, the raised floor can mean real savings
in annual flood insurance premiums, lower annual housing costs,
and overall lower cost over the lifetime of a fixed-rate 30-year
mortgage.
The owners of the example raised floor home, will save $6,605
($36,630 minus $30,025) over their 30-year mortgage. The savings
calculation, shown in Table 3 and Figure
1, is based on annual payments of principle plus interest
(P+I) for only the cost of the foundations (Table
1), at an interest rate of 6%. In addition, the corresponding
annual flood insurance premiums for a multi-story residence
(Table 2) were used, assuming 5% annual
increases. Finally, the savings calculation is based upon the
net present value of the foundation plus insurance, discounted
back to today's dollars at a rate of 4%.
Table
3 Foundation and Flood Insurance Cost Comparison
RAISED
FLOOR + 2 BFE
SLAB-ON-GRADE
at BFE
Year
P + I (annual)
Flood Insurance (annual)
Total
P + I (annual)
Flood Insurance (annual)
Total
1
$1,008
$ 379
$1,387
$ 932
$ 617
$1,549
10
$1,008
$ 588
$1,596
$ 932
$ 957
$1,889
15
$1,008
$ 750
$1,758
$ 932
$1,222
$2,154
20
$1,008
$ 958
$1,966
$ 932
$1,559
$2,491
30
$1,008
$1,560
$2,568
$ 932
$2,540
$3,472
Total Cost in Today's Dollars: $30,025
Total Cost in Today's Dollars: $36,630
Source: Southern Pine Council
calculation based on Table
1 and Table 2.
P + I = Principle plus Interest, BFE = Base Flood Elevation
Raised Floors Help this Community Meet Floodplain Management
Goals
The National Flood Insurance Program (NFIP) Community Rating
System (CRS) provides discounts on flood insurance premiums
in those communities that establish floodplain management
programs that exceed NFIP minimum requirements.
Raising a house can be a costly
option for the homeowner. This slab-on-grade home in
St. Tammany Parish, Louisiana, was raised at a total
cost of approximately $150,000. A matching grant from
FEMA's Pre-Disaster Mitigation program pays 75% of the
expense to raise a home, with the homeowner bearing
the remaining 25% of the cost.
St. Tammany Parish in Louisiana is one of those communities.
Citizens of St. Tammany receive a 5% discount on their premiums
due to ordinances that more strictly define the systems and
techniques used to construct a foundation in flood-prone areas.
Raised floors are part of the solution.
In designated flood zones, the parish limits the volume of
fill that can be placed to elevate the floor of a structure
above base flood elevation (BFE). These measures help prevent
displacement of floodwaters onto adjacent property. Furthermore,
if the structure must be raised over a certain height above
natural ground grade to meet BFE, then the builder must use
pier- and-beam or pile construction. These open foundations
do not displace floodwaters and also allow high velocity waters
to flow under the structure.
St. Tammany is also an active participant in the Federal
Emergency Management Agency (FEMA) floodproofing program.
Under programs such as Flood Mitigation Assistance, FEMA
provides grants to help owners of flood-prone homes have
their houses raised. To qualify, a homeowner must have a
federal flood insurance policy in effect and must have made
at least two claims on the policy within the past 10 years.
The federal government
makes flood insurance available to NFIP participating communities
that adopt and enforce ordinances to reduce future flood risks.
This insurance is available to all owners of insurable structures
whether in or outside the floodplain.
