All federally backed loans require properties located within a flood hazard area to maintain flood insurance. Without an Elevation Certificate, your insurance will be rated at the highest premium, which will cost you thousands over the course of your loan. Aside from saving you money, your Elevation Certificate also arms you with the information you want as a property owner. You’ll find out how high water within your building is expected to get in the event of a “base flood” (which has a 1 percent chance of occurring in a given year). This allows you — and your insurance company — to determine how much damage might be expected as a result of a substantial flood. Flood designation already in place? You should know these designations can be changed. An Elevation Certificate, combined with an application for a LOMA (Letter of Map Amendment) can accomplish this.
Elevation Certificates: Who Needs Them and Why
If your home or business is in a high-risk area, your insurance agent will likely need an Elevation Certificate (EC) to determine your flood insurance premium. Floods mean rising water. Knowing your building’s elevation compared to the estimated height floodwaters will reach in a major flood helps determine your flood risk and the cost of your flood insurance. An EC documents the elevation of your building for the floodplain managers enforcing local building ordinance, and for insurance rating purposes.
How an EC Is Used
If your building is in a high-risk area—a zone indicated with the letters A or V on a Flood Insurance Rate Map (FIRM)—the EC includes important information that is needed for determining a riskbased premium rate for a flood insurance policy. For example, the EC shows the location of the building, Lowest Floor Elevation, building characteristics, and flood zone.
Your insurance agent will use the EC to compare your building’s elevation to the Base Flood Elevation (BFE) shown on the map being used for rating and determine the cost to cover your flood risk.
The BFE is the elevation that floodwaters are estimated to have a 1 percent chance of reaching or exceeding in any given year. The higher your lowest floor is above the BFE, the lower the risk of flooding. Lower risk typically means lower flood insurance premiums.
Who Needs an EC
For certain high-risk structures, an EC is required by an insurer as a condition for issuing flood coverage. There are exceptions. For example, if your building was constructed before your community’s first FIRM became effective (known as pre-FIRM) and you are eligible for a subsidized rate, you do not need an EC to purchase coverage. However, subsidized rates for pre-FIRM buildings are being phased out through annual premium increases. Your full-risk rate is specific to the property, and an EC will be needed to calculate the property-specific full-risk rate. Depending on your elevation, the full-risk rate could already be lower than the subsidized rate.
ECs are not required and are not used for rating in moderate- to low-risk areas (Zones X, B, and C), undetermined risk areas (Zone D), or certain high-risk areas eligible for other subsidies (e.g., Zones AR and A99). If you need to document that your building is in one of these zones, you can simply provide a copy of the current FIRM that marks the building’s location or obtain a letter signed and dated by a community official listing the building’s address and flood zone. The property will remain eligible for the NFIP grandfather procedure if continuous coverage is maintained.
Where to Get an Elevation Certificate for Your Building
1. Ask your local floodplain manager. One might already be on file. Every National Flood Insurance Program (NFIP)–participating community has a floodplain manager, but that person might have a different title or serve in multiple capacities.
2. Ask the sellers. When buying a property, ask the sellers to give you their EC. If they don’t have an EC, ask if they can provide one before settlement.
3. Ask the developer or builder. In a high-risk area, the developer or builder might have been required to get an EC at the time of construction.
4. Check the property deed. ECs sometimes are included with the property deed.
5. Hire a licensed land surveyor, professional engineer, or certified architect who is authorized by law to certify elevation information. For a fee, these professionals can complete an EC for you. To find a professional surveyor:
• Check with your State professional association for land surveyors.
• Ask your State NFIP coordinator.
• Talk to your local building permit office.
When You Need a New EC
If you make substantial changes to your building in a high-risk area—for example, you make an addition to your home or convert the garage to living space—you likely need a new EC to reflect the new building characteristics and Lowest Floor Elevation.
When You Do Not Need a New EC
As long as the structure information on your EC is accurate, you do not need a new one. If you get an EC from the previous property owner or have a copy of the one on file with your community, your insurance agent can use the EC to rate your policy.
If your community adopted new FIRMs and your building has not changed, your insurance agent can rate your policy using the information on the old EC and the FIRM used to rate your policy. However, you might need to provide additional information, such as new photographs of your home or business.
Plan for the Future
Building code requirements might change over time as flood risk changes and maps are updated. If you are remodeling or rebuilding, consider elevating to lower your flood risk, which, in turn, can lower your flood insurance rates and reduce the financial impact of the next flood.
• Base Flood: The flood having a 1 percent chance of being equaled or exceeded in any given year.
• Base Flood Elevation (BFE): The water surface elevation, expressed as an elevation above sea level, of the base flood. This is the minimum elevation a community must adopt for building standards.
• Flood Insurance Rate Map (FIRM): A map issued by the Federal Emergency Management Agency (FEMA) showing flood hazard areas, BFEs, and risk premium zones.
• Pre-FIRM: Buildings constructed before the community’s first FIRM. Communities might not have elevation information on file for these properties.
• Post-FIRM: A building constructed on or after the date of the initial FIRM for your community. FIRM effective dates can be found at http://FEMA.gov/FEMA/csb.shtm.
For flood insurance information and to find an agent: http://FloodSmart.gov
Find your flood zone: http://msc.FEMA.gov
Locate your State floodplain manager: http://floods.org
Contact a surveyor from your National Society of Professional Surveyors state affiliate: http://nsps.us.com
Download a copy of the Elevation Certificate: http://FEMA.gov/media-library/assets/documents/160