Wednesday, May 7, 2014

UNO-CHART's Community Rating System Works to Increase Resilience and Lower Flood Insurance Premiums

A community rating system developed by the University of New Orleans' Center for Hazards Assessment, Response, and Technology (UNO-CHART) saved certain Louisiana residents nearly $35 million on flood insurance premiums in 2013.  A community rating system developed by the University of New Orleans' Center for Hazards Assessment, Response, and Technology (UNO-CHART) saved certain Louisiana residents nearly $35 million on flood insurance premiums in 2013.

A community rating system facilitated by the University of New Orleans' Center for Hazards Assessment, Response, and Technology (UNO-CHART) saved certain Louisiana residents nearly $35 million on flood insurance premiums in 2013. UNO-CHART has worked with local communities since 2011 to understand and implement the community rating system, which was created by the Federal Emergency Management Agency 20 years ago.

"UNO-CHART has been working with residents and government officials to lower the risks to flooding, improve the resilience of local communities and lower the flood insurance premiums of Louisiana residents living in the Special Flood Hazard Area (SFHA)," said Monica Teets Farris, director of UNO-CHART. "With the enactment of Biggert-Waters, participation in the CRS is encouraged more than ever, as it provides opportunities for participating communities to earn reductions in flood insurance premiums for residents and business owners."

The aim of the Center for Hazards Assessment, Response & Technology at The University of New Orleans (UNO-CHART) is to support applied research focusing on sustainability and resilience efforts and strategies in light of natural, technological, and environmental risks in the region and to collaborate with similar programs across the country. Through applied research projects, the center assists residents, local and state officials, and communities in understanding and reducing risk to hazards.

The community rating system is a voluntary program that provides incentives for communities to go beyond the minimum floodplain management regulations established by the National Flood Insurance Program to minimize flood losses, Farris said. In July 2012, Congress passed the Biggert-Waters Flood Insurance Reform Act, which was enacted to ensure the financial viability of the National Flood Insurance Program. Major components call for the elimination of subsidies currently allocated to flood insurance policyholders around the country.

As of January 2013, policyholders began to see a 25 percent increase in flood insurance for their non-primary residences, the researcher said. In October 2013, businesses, properties deemed "severe repetitive loss properties" and properties that have experienced losses that exceed the fair market value of their homes also began to see a 25 percent increase in their premiums.

Wave of Change

The legislation and ensuring rise in flood insurance costs has caused controversy but thanks to the CRS system some Louisiana residents are finding relief, said researcher Michelle Esposito. Policyholders whose properties were not insured as of July 2012, who had newly purchased properties or who allowed their policies to lapse will see nearly $35 million in flood insurance premium discounts this year.

The goals of the activities promoted by the CRS include: the reduction of flood damage, support of the NFIP and support of a comprehensive approach to floodplain management, Farris said. Communities that join the CRS complete floodplain management activities that are worth a certain amount of credit — the more credit earned, the better the class ranking of that community and the higher the premium discounts.

The CRS has 10 classes; a class ranking of 10 carries no flood insurance premium reduction, whereas a class ranking of 1 carries the maximum discount of 45 percent, she said. CRS User Groups are comprised of participating CRS communities that gather regionally on a regular basis to stay informed of programmatic changes while sharing best practices and lessons learned.

A side benefit is that participating communities work together as neighbors to enhance the resilience of the region, foster coordination between municipalities, and "make Louisiana safer, stronger, and a more sustainable place to live," Farris said.

UNO-CHART serves as a facilitator to these groups, said Farris, planning, leading, and documenting meetings, then providing current updates on changes to CRS and the NFIP. UNO-CHART also provides assistance by conducting research and writing reports required by the CRS program and provides participants with meeting spaces, webinar access, and information about Continuing Education Credit opportunities to Certified Floodplain Managers.

"UNO-CHART identifies the strengths and weaknesses of each community's CRS standings and coordinates presentations on those CRS activities to improve the groups' knowledge about each class of points and provide suggestions on how they can improve on their weaker areas," said Farris.

By request of the participating communities, UNO-CHART currently facilitates three of the four CRS Users' Groups in Louisiana: Flood Loss Outreach and Awareness Taskforce (FLOAT), Capital Region Area Floodplain Task-Force (CRAFT), and the Jefferson Parish Users' Group, Farris said.

These three groups bring together floodplain managers, code enforcement personnel, planners and CRS coordinators from twelve parishes and 15 cities, including: Ascension, East Baton Rouge, Jefferson, Lafourche, Livingston, Orleans, St. Bernard Parish, St. John the Baptist, St. Tammany, Tangipahoa, Terrebonne and West Baton Rouge parishes and the following cities: Central, Covington, Denham Springs, Gonzales, Gretna, Harahan, Houma, Kenner, Mandeville, Slidell, Walker, Westwego, Zachary, Grand Isle and Jean Laffite.

The list represents roughly 2.2 million Louisiana residents and 47 percent of Louisiana's population, Farris said.
"These three groups saved Louisiana residents $34,917,626 on their flood insurance premiums, in 2013 alone," said Farris. "This savings represents 93 percent of all CRS savings in Louisiana."

Although UNO-CHART continues to help in saving millions of dollars for several Louisiana communities, the nonprofit research arm of the University has done so with limited or no funding for this work since 2011, said Farris.


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