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Everything You Wanted To Know About Flood Insurance But Were Afraid To Ask · Inside West Palm Beach

12:28:00
Welcome to the City Center
12:28:01
podcast. I'm Gerry Marcelo.
12:28:04
So, you're a homeowner, or you're
12:28:06
thinking about buying a
12:28:07
home in West Palm Beach.
12:28:09
You sign up for homeowners insurance,
12:28:11
then pony up for windstorm insurance.
12:28:13
You think you're all
12:28:14
covered, right? No, you're not.
12:28:17
Today we're going to
12:28:17
talk about flood insurance.
12:28:20
Protection against flood is important for
12:28:21
everyone in South Florida,
12:28:23
not just along the coast.
12:28:25
What if you live in a tall
12:28:26
condo or rent an apartment?
12:28:28
You should be looking
12:28:29
into flood insurance as well.
12:28:31
We'll talk to an expert about how you can
12:28:33
protect yourself from a
12:28:34
very common Florida calamity.
12:28:37
That's coming up next.
12:28:42
And joining us today is Robert Norberg,
12:28:44
President of Arden Insurance.
12:28:46
Robert, thanks for joining us.
12:28:48
Hey, thanks for having me on.
12:28:50
You know, I'm a homeowner
12:28:52
here in South Florida, okay?
12:28:53
And, you know, I came to the state,
12:28:56
bought a house, went through the
12:28:58
requisite of, you know, looking at
12:28:59
insurance, picking out insurance.
12:29:01
And then I was struck by the fact that
12:29:03
someone walked up to me and said, "Well,
12:29:05
what about flood insurance?"
12:29:07
Now, I was surprised that it's a separate
12:29:09
entity. It's a separate thing altogether.
12:29:12
Tell us a little bit about what the
12:29:14
difference is between a regular home
12:29:16
policy and what flood insurance involves.
12:29:19
Well, yeah, that's one of the things that
12:29:21
people don't really understand always.
12:29:23
You know, your homeowner's policy is
12:29:25
basically an all-encompassing type of
12:29:28
policy in most cases,
12:29:30
but it does not cover flood insurance.
12:29:34
And most people think, "Well, I'm not in
12:29:36
a flood zone per se."
12:29:39
So they say, "Well, I don't need that
12:29:40
unless the bank's going to require it."
12:29:44
But we in the industry, you have to
12:29:46
educate people and tell them that
12:29:48
everyone is in a flood zone.
12:29:50
It's just a matter of whether it's a high
12:29:52
hazard or low hazard.
12:29:55
And, you know, the banks are only
12:29:56
requiring flood insurance as separate
12:29:58
policy when you are
12:30:01
in a high hazard area.
12:30:03
Okay, I see. So, all right.
12:30:05
So, again, if I'm new to Florida and I'm
12:30:10
new to the game of
12:30:11
getting homeowners insurance,
12:30:13
you know, I can get insurance that covers
12:30:15
contents of my home,
12:30:17
the structure of my home.
12:30:19
Again, but flood is different.
12:30:21
And why did they break that out? Why is
12:30:24
there a different policy altogether?
12:30:26
Well, again, it's a different type of
12:30:29
thing, a different type of coverage.
12:30:30
Most people think that flood is any water
12:30:32
that's in your house, and
12:30:35
that's not flood insurance.
12:30:36
Flood insurance covers only water rising
12:30:39
up from the outside coming
12:30:41
into the house from any source.
12:30:44
Okay.
12:30:45
So, a lot of people will call me and say,
12:30:46
"Hey, my pipe's broke," or, "I got a leak
12:30:48
in the house and I've got a flood."
12:30:50
That's not flood insurance. That's water
12:30:53
damage covered by the homeowners policy.
12:30:55
So, yeah, all right.
12:30:56
So, there's a big misconception about
12:30:58
what flood really is, first of all.
12:31:00
Right.
12:31:01
So, like a good example, say, if there's
12:31:03
a problem and you have a toilet backup,
12:31:06
that would not be flood
12:31:07
insurance, it's homeowners.
12:31:10
Right.
12:31:10
Okay.
12:31:11
And so, but the good thing is that you
12:31:14
can buy policies relatively cheap for
12:31:16
flood even in the low hazard areas.
12:31:20
And we like to educate people and tell
12:31:22
them they need to understand that 25% of
12:31:25
all flood claims
12:31:27
happen in low hazard areas.
12:31:29
Hmm.
12:31:30
So, a lot of the flooding, for example,
12:31:32
that took place during recent hurricanes
12:31:34
on the west coast of Florida,
12:31:36
a lot of those people did not have flood
12:31:37
insurance because
12:31:38
they were in low hazard,
12:31:40
but they ended up needing flood insurance
12:31:42
once everything moved in.
12:31:44
So, it's a good idea to look into flood
12:31:46
insurance no matter
12:31:47
where you are in Florida.
12:31:49
Is it a myth that the highest or you
12:31:53
really got to worry about flood if you're
12:31:55
living within a very
12:31:57
short distance of the coast?
12:31:59
Yeah.
12:31:59
Most people think that they only need
12:32:01
flood if they're near the coast.
12:32:03
But as we know from all these studies and
12:32:06
things like that, people that are inland,
12:32:08
even in out in Loxahatchee or out west
12:32:11
near grassy waters or in Ibis,
12:32:14
there are low lying areas there that
12:32:15
flood and you need flood insurance there.
12:32:18
There are some high hazard areas all the
12:32:21
way in the central part of the state that
12:32:23
are high areas for flooding.
12:32:26
So, it just depends on the geography
12:32:28
around you, the lakes, the water system.
12:32:32
I mean, back in 1999, we had a lot of
12:32:34
flooding in western Boynton and mainly
12:32:37
because the water evacuation system was
12:32:42
not working properly.
12:32:43
A lot of the floodgates
12:32:44
weren't opened in the canals.
12:32:46
A lot of the people that were living in
12:32:48
cul-de-sacs where water ran in ended up
12:32:51
having flooding issues.
12:32:53
Now, I, as a personal story, I used to
12:32:55
have a home up in Palm
12:32:57
Beach Gardens right near I-95.
12:32:59
This is many, many years ago before that
12:33:01
area has really been developed up.
12:33:03
And what happened is that we had a,
12:33:05
basically a weather system stall out over
12:33:08
our neighborhood, literally, and dump
12:33:10
inches and inches and inches of rain.
12:33:13
And the water started to rise and we
12:33:14
were, you know, we're three or four miles
12:33:16
from the water, from the ocean.
12:33:19
And we see the water rising and rising.
12:33:21
And then the actual thing that really
12:33:22
caused this problem was that we were next
12:33:24
to a Yew Pickham farm.
12:33:26
Correct.
12:33:26
And the Yew Pickham farm opened up their
12:33:28
floodgates and it
12:33:29
poured into our neighborhood.
12:33:31
Right.
12:33:31
And I'll never forget it.
12:33:33
It was totally shocking to think we're
12:33:36
this far away from what we consider to be
12:33:38
hazardous areas for flooding and we're
12:33:41
getting flooded out.
12:33:42
Right.
12:33:43
So, yes, absolutely.
12:33:44
You can be deep in central parts of the
12:33:47
county and the city of West Palm Beach
12:33:50
and be really in danger of flooding.
12:33:53
Right.
12:33:54
And that's the thing
12:33:54
about a flood policy.
12:33:55
It's very specific.
12:33:58
Water rising up from the
12:33:59
outside, coming into your house.
12:34:01
Right.
12:34:01
Okay.
12:34:02
So we've had some freak incidences where
12:34:03
a city pipe breakage, a water main can
12:34:08
break and flood a whole neighborhood.
12:34:11
And if you don't have
12:34:12
flood insurance, zero coverage.
12:34:14
So in that instance, because a main broke
12:34:17
and caused the flood, you're still
12:34:18
covered in that situation?
12:34:20
No. Or does it have to be a natural?
12:34:22
No, it's not.
12:34:22
No, from any source.
12:34:24
So you can have, you know, a fire hydrant
12:34:27
blow and flood your house.
12:34:29
The only stipulation under the federal
12:34:30
flood program is water has to rise up and
12:34:35
flood your property and
12:34:38
a neighboring property.
12:34:40
Okay.
12:34:41
You can't have a singular property flood.
12:34:43
However, there are some incidences where
12:34:45
they look at the swale, the street, those
12:34:50
type of things and they consider those a
12:34:53
neighboring property.
12:34:55
So, and then when you're on acreage, of
12:34:56
course, it's going to be
12:34:58
how much acreage is flooded.
12:35:00
I see.
12:35:00
I see.
12:35:01
Well, we've talked about all the little
12:35:03
places that people would not have thought
12:35:05
about as being areas prone to
12:35:06
flooding or possible flooding.
12:35:08
How would I know as a
12:35:10
homeowner, what my danger is?
12:35:12
Is there some sort of historical record
12:35:13
or something I can look at to
12:35:15
find out what danger I'm in?
12:35:17
Yeah, you can go to the national flood
12:35:19
program or the FEMA site and plug in your
12:35:22
address and find out your flood zone and
12:35:26
your propensity to flooding.
12:35:28
So it will tell you whether you're in
12:35:30
high risk or low risk.
12:35:32
The other easy way is to
12:35:33
ask your insurance agent.
12:35:34
Sure.
12:35:35
Call your insurance agent and say, hey,
12:35:36
run me a flood quote.
12:35:38
Let me know what's going on.
12:35:40
And with the programs we have today,
12:35:41
they're very sophisticated.
12:35:43
They will print out
12:35:43
the national flood maps.
12:35:45
They will give you all the information
12:35:47
you need to know so that you can assess
12:35:49
your risk of flooding.
12:35:51
But like I said, the low hazard zones are
12:35:54
significantly cheaper for flood insurance
12:35:57
than, you know, if you're in high hazard.
12:36:01
Yeah.
12:36:02
And to be clear here, because we could
12:36:04
jump over, I know a lot of people are
12:36:06
familiar with, you know, wind damage or
12:36:09
wind, windstorm type of insurance that
12:36:12
can be very, very expensive
12:36:13
in this part of the world.
12:36:15
Flood insurance, I think I'm
12:36:16
understanding, doesn't necessarily be in
12:36:18
that same kind of ballpark.
12:36:19
That's correct.
12:36:20
Unless, you know, most of you, like we
12:36:22
talked about earlier, your coastal areas,
12:36:25
your beach properties, those type of
12:36:27
things are going to be a lot more
12:36:28
expensive than if you're in, say, western
12:36:31
parts of the county.
12:36:33
Right.
12:36:33
Plus, when you're in a low hazard zone,
12:36:36
they say, okay, the likelihood of
12:36:38
flooding here is significantly less, so
12:36:40
the price comes down.
12:36:42
I got you.
12:36:43
And that varies based on companies.
12:36:45
It used to be that, you know, several
12:36:47
years back, you could only get flood
12:36:49
insurance through the
12:36:50
federal flood program.
12:36:52
Today, we've got probably dozens of
12:36:54
private market companies that also will
12:36:57
give you flood insurance and sometimes
12:37:01
significantly cheaper, plus better
12:37:04
coverage than the national flood program.
12:37:07
So, there's a lot of different caveats
12:37:09
you got to look into.
12:37:11
Right.
12:37:11
Talk to your agent, call an agent, make
12:37:14
sure you look it up on the FEMA site.
12:37:16
You know, you can find
12:37:17
flood insurance fairly easily.
12:37:19
They say call your agent.
12:37:20
You're saying that your homeowner, the
12:37:22
agent who provided you with your
12:37:23
homeowner's insurance, can also help you
12:37:25
with the flood insurance.
12:37:26
Right.
12:37:27
They're not a special--
12:37:27
Yeah.
12:37:28
And most good agents out there offer you
12:37:31
flood insurance when you
12:37:32
come to them on the first time.
12:37:34
Right.
12:37:34
But again, you should re-look at this.
12:37:36
You know, we've got sea level rise.
12:37:38
We've got a lot of things going on.
12:37:39
We've got king tides that are happening
12:37:42
now here in the area that didn't happen
12:37:44
years ago when I was growing up.
12:37:47
So, you may need flood insurance now when
12:37:49
you didn't need it years ago.
12:37:51
Yeah, I'm glad that you brought that up
12:37:52
because that's a really important issue.
12:37:54
I mean, with climate change and the
12:37:57
threats of what climate change may bring,
12:37:59
have you as a person involved in
12:38:02
insurance seen an increase in claims
12:38:07
against flooding because of that?
12:38:09
Well, it's mainly because of
12:38:10
the weather patterns changing.
12:38:12
Yeah.
12:38:12
I mean, most of our recent storm events
12:38:15
in times of right now in the last five,
12:38:18
six years have ended up being a flood
12:38:21
related event because of the amount of
12:38:23
rain they're dropping, how the waters are
12:38:26
being pushed inland
12:38:27
where they normally wouldn't.
12:38:29
So, that's the type of
12:38:31
thing that I worry about mostly.
12:38:33
I mean, you could be in a mile from the
12:38:36
coast and still get flooding now with the
12:38:38
way that these storms have been working.
12:38:40
Yeah.
12:38:41
So, that's the other thing.
12:38:43
I mean, I would suggest that everybody
12:38:45
out there just consider it.
12:38:48
Call your agent, have them run the quote,
12:38:50
and say, "Okay, what's
12:38:52
the risk versus the reward?"
12:38:54
Yeah.
12:38:55
And the agent would be the one who will
12:38:56
go ahead and check the flood zones and
12:38:59
figure out what your actual
12:39:00
danger is in your location.
12:39:02
Right.
12:39:02
They can share that with you.
12:39:04
That's a great value.
12:39:06
Yeah.
12:39:06
That's an important thing.
12:39:08
In your experience, again, are we seeing
12:39:12
that if you are living, say, east of US1
12:39:15
or east of one of the main north-south
12:39:17
highways, are you in greater danger?
12:39:19
Or is it all about the same?
12:39:21
No, it is.
12:39:22
It gets as you get
12:39:23
coastal, but it depends.
12:39:25
I mean, the high hazard
12:39:27
zones keep getting updated.
12:39:29
We just had a recent update here in the
12:39:31
county, and some of the maps were
12:39:33
expanded to be closer or further west
12:39:37
than they used to be.
12:39:39
So, the high hazard zones have
12:39:41
progressively moved inland.
12:39:44
So, people that used to be, for example,
12:39:46
just west of Olive, now some
12:39:49
of those are a high hazard zone.
12:39:51
Yeah.
12:39:52
So, a lot of that has to do with the way
12:39:54
they've got the maps down to within six
12:39:58
inches of these elevations.
12:40:00
So, they're very sophisticated technology
12:40:02
nowadays has helped because before it
12:40:06
used to be almost a flagler and a little
12:40:09
bit past flagler here in West Palm.
12:40:13
And then now it's moved
12:40:14
all the way up to Olive.
12:40:15
Did this change recently happen?
12:40:17
Yeah, it happened last year.
12:40:19
Yeah.
12:40:19
So, the new maps came out last year.
12:40:22
And so, some of these people that had
12:40:24
loans got notified by their bank and
12:40:27
said, "Hey, now you have
12:40:29
to provide flood insurance."
12:40:30
And they're like, "Well, what happened?"
12:40:32
What happened?
12:40:33
Yeah.
12:40:34
So, and then we have to educate them on
12:40:36
how the maps change.
12:40:38
And we have to provide flood insurance.
12:40:41
We've talked about owning a home.
12:40:43
Is there any provision or any kind of
12:40:46
thing that a renter needs to worry about?
12:40:48
Or is that purely up to the landlord?
12:40:50
Well, no, it's up to the renter.
12:40:52
Because the renter's contents is not
12:40:54
covered by the landlord's policy.
12:40:57
So, if you're in a high hazard area, say
12:41:00
you live east or right on the coast and
12:41:02
you're renting, you got to
12:41:04
think about your contents.
12:41:06
Sure.
12:41:06
Because your contents, your stuff, your
12:41:08
furniture and those things are not
12:41:09
covered by the landlord's policy.
12:41:12
Would that, would you be protected with
12:41:14
just standard renter's insurance or do
12:41:16
you need to look at some sort of—
12:41:17
No, same rules apply.
12:41:20
So, you can have a renter's policy and it
12:41:22
covers everything else, your fire, your
12:41:24
windstorm and all those type of things.
12:41:26
But it does not cover flood.
12:41:28
Wow. Okay. That is new and
12:41:30
important information for me.
12:41:32
If you are renting, you can have renter's
12:41:35
insurance, but you're still not covered
12:41:36
for possible damage from flooding.
12:41:38
Correct.
12:41:39
Wow.
12:41:40
Okay.
12:41:41
And there's another unique
12:41:42
thing we have to deal with here.
12:41:45
A lot of people that are in higher
12:41:47
condos, say they're second floor and
12:41:50
above, a lot of those people feel that,
12:41:53
"Hey, I might be in high hazard, but I'm
12:41:56
elevated. I don't need flood insurance."
12:41:59
Well, there has been cases where if you
12:42:02
have flood insurance on upper floors,
12:42:04
you're much better protected from things
12:42:07
like a huge assessment for that building.
12:42:10
Because what happens is a flood comes in
12:42:12
and knocks out all the systems and then
12:42:15
you get an assessment
12:42:18
from your building that says,
12:42:21
"Hey, our flood coverage only covered
12:42:23
this mount, plus we got to now redo all
12:42:26
the elevators, the electric and
12:42:27
everything like that."
12:42:29
And you on the sixth floor get an
12:42:30
assessment that says, "Hey, owe us
12:42:34
$20,000 for the assessment."
12:42:36
If you have a flood policy, it
12:42:38
would pay that in many cases.
12:42:41
Wow.
12:42:42
So you weren't impacted directly, but
12:42:44
indirectly you were impacted.
12:42:46
So a lot of people don't know about that
12:42:47
when they're living in
12:42:48
these condos, upper floors.
12:42:50
I would immediately jump to your first
12:42:52
assumption, "Hey, I'm here
12:42:54
on the 10th floor. I'm cool."
12:42:56
Yeah.
12:42:56
No, you're not.
12:42:57
Right.
12:42:58
Wow.
12:43:00
So you've seen that happen on some of the
12:43:01
West Coast flooding where the bottom
12:43:03
floor and the whole building had to be
12:43:05
reconstructed, which includes all the
12:43:07
systems that supply the upper units.
12:43:10
You know, looking at some of the video of
12:43:11
the unfortunate, terrible storm that we
12:43:14
saw run across the Florida West Coast, we
12:43:17
saw many hundreds of cars that were
12:43:19
destroyed by floodwaters.
12:43:21
What about that?
12:43:22
Is there something that you buy flood
12:43:23
insurance for your car?
12:43:24
Or is that covered?
12:43:25
Yeah.
12:43:26
Flood insurance on car policies is
12:43:29
covered under comprehensive coverage.
12:43:31
Okay.
12:43:31
So when people buy comp and collision,
12:43:34
the comp covers things like flooding,
12:43:37
fire, hail, damage, all those type of
12:43:40
things, windstorm events.
12:43:41
But interestingly enough, a lot of people
12:43:43
say, "Well, you know, my car is a little
12:43:45
bit older. I'm not
12:43:46
going to buy that comp."
12:43:48
And then they go get flooded
12:43:50
out or stuck in a flooding area.
12:43:53
And that's where we had a ton
12:43:54
of claims on the West Coast.
12:43:56
A lot of those claims were flooded out
12:43:59
cars everywhere you see.
12:44:01
And those are basically a total loss.
12:44:04
Yeah, absolutely.
12:44:05
Because you can't once saltwater
12:44:07
intrusion gets in a car,
12:44:08
there's nothing you can do.
12:44:10
But a lot of those people, well, well, I
12:44:12
dropped comp and collision a few years
12:44:14
ago to save some money.
12:44:16
Guess what? No coverage.
12:44:18
That's an eye opener.
12:44:20
Right.
12:44:21
Okay. So we've seen just how flooding
12:44:24
could theoretically impact almost every
12:44:27
point of your life as far as property and
12:44:29
just taking care of
12:44:32
your shelter and your home.
12:44:35
So it's important to just going over it
12:44:38
again, not to assume that any particular
12:44:40
area is a safe zone, especially here in
12:44:43
Palm Beach County and in West Palm Beach.
12:44:45
That's correct. Yeah.
12:44:46
And we tell everybody, if you're in
12:44:47
Florida, check out a flood policy.
12:44:50
Doesn't matter where you are inland,
12:44:52
coastal or whatever.
12:44:53
Yeah.
12:44:54
Check out a flood policy.
12:44:55
You may in fact need it.
12:44:56
Right. Yeah.
12:44:57
And we're not talking a
12:44:59
ginormous amount of money.
12:45:01
This is something that, you know, people
12:45:02
have their heads spin when they see what
12:45:04
windstorm may be involved.
12:45:07
Right.
12:45:07
But a flood insurance is a
12:45:09
little bit more approachable.
12:45:10
Correct. Okay.
12:45:11
And here's another twist
12:45:12
we deal with in Florida.
12:45:13
Many of our clients out there have
12:45:15
citizens policies,
12:45:17
citizens windstorm insurance.
12:45:20
Or a citizen's homeowners.
12:45:22
Well, citizens has been in the process of
12:45:24
requiring flood for every one of their
12:45:28
policyholders that
12:45:29
has windstorm coverage.
12:45:32
And that started a few years ago.
12:45:34
Currently, if your home is valued with
12:45:36
citizens at 400,000 or above, which many
12:45:41
homes are nowadays, you're going to be
12:45:44
required to get a flood policy, whether
12:45:47
you're in high hazard or low hazard.
12:45:48
So if you have windstorm coverage with
12:45:51
citizens, you better look into getting
12:45:53
flood because they're going to require it
12:45:56
or they're going to non-renew the policy.
12:45:58
Okay.
12:45:58
Yeah.
12:45:59
Well, the message is clear.
12:46:01
If you're going to be smart and you're
12:46:03
living in South Florida, whether you
12:46:04
rent, whether you own,
12:46:06
it's smart to look into this.
12:46:07
And it's as simple as a phone call to
12:46:09
your current insurance agent.
12:46:11
Yeah. Your current agent, any agent.
12:46:13
And there are actually some online
12:46:14
sources too that are now providing direct
12:46:17
flood to the consumer.
12:46:19
If you had the opportunity to send a
12:46:20
message to the folks at home that are on
12:46:23
the fence about really looking into this,
12:46:25
what would you tell them?
12:46:26
Well, the message is clear.
12:46:27
If you live in Florida,
12:46:29
you need flood insurance.
12:46:30
No matter if you're a homeowner or a
12:46:32
renter or a building owner.
12:46:34
And that goes for commercial as well.
12:46:36
A lot of these commercial companies don't
12:46:39
think they need flood insurance.
12:46:41
And again, when that street flooding
12:46:43
comes and floods out their business, if
12:46:46
they don't have a flood policy, then
12:46:48
they're out of luck.
12:46:50
Robert, thank you for your time today.
12:46:51
We really appreciate you sharing this
12:46:53
vital information with our audience.
12:46:55
Yeah, it's great.
12:46:56
Great to be here.
12:46:57
Thank you.
12:46:58
Thank you for joining us.
12:47:00
There's a lot online about flood
12:47:02
insurance, so a great place to start is
12:47:04
right here on the city's website.
12:47:06
Just visit WPB.org front slash flood for
12:47:11
information and important links to
12:47:12
official information about flood zones,
12:47:15
flood hazards and how to get the right
12:47:17
flood insurance for your home.
12:47:19
Thanks to Robert
12:47:20
Norberg of Art and Insurance.
12:47:22
The City Center podcast is a production
12:47:23
of the City of West Palm Beach
12:47:25
Communications Department.
12:47:27
I'm Jerry Marcello.
12:47:28
We'll see you next time.