Officials say only a small number of Minot, N.D., residents have been forced to pay higher premiums for flood insurance, despite a devastating flood three years ago that wiped out most of the city.
Multiple claims on a property will typically increase the flood-risk classification and lead to higher premiums. But only a small percentage of people had flood insurance in 2011 and most of them did not have previous claims, the Minot Daily News reports.
“We have seen some individuals where that has affected them, but I can probably count them on one hand,” said Tim Olson, personal lines agent with First Western Insurance in Minot.
Minot’s valley is still considered a non-flood plain despite the 2011 event, said Brian Hvinden, spokesman for the Federal Emergency Management Agency. FEMA is working on new maps, but in the meantime most homeowners are eligible for preferred-risk policies.
The June 2011 flood caused by heavy spring snowmelt and rains damaged or destroyed more than 4,000 homes, businesses and other structures in Minot. It caused nearly $700 million in damage.
The amount of the premium change would depend on the coverage. A homeowner who paid $460 a year for a preferred risk policy could end up paying $2,000 or more for a standard risk policy, depending on the coverage, Olson said.
Hvinden noted the standard risk premium in the non-flood plain still remains lower than a policy in a flood plain.
The risk classification is tied to the flood experience of the property and not the flood experience of the owner. Olson said that the classification rules shouldn’t discourage homeowners from filing a claim if they have damages.