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Information On How To Cancel Your Flood Insurance Policy (and Hopefully Get Refund Of Final Premium Paid)

Property owners must take specific actions to remove flood ins. req't from their property loan and get refund of final premium

We post FEMA "Letter of Map Revision" and other useful info

(January 12, 2002) -- As previously reported by LBReport.com, FEMA has ended its mandatory flood insurance zone imposed in parts of ELB and NLB in July, 1998.

Property owners in these parts of ELB (generally E. of Lakewood Blvd. & E. (or N.) of PCH) and NLB (generally N. of San Antonio) are no longer federally required to buy FEMA's flood insurance if they have federally backed loans on their property.

If you're in one of the removed areas (marked in red on the quick reference maps below), you're free of the federal "flood tax" mandate...BUT...there are several steps you must take to get the insurance requirement dropped from your federally backed loan and a refund of your final premium paid. (That's if you want to end your flood insurance coverage; you may choose to keep it since homeowner's insurance does not cover flood damage.)

First, do not just cancel your policy or let your policy lapse, or you might jeopardize your ability to qualify for the refund. Follow the specific steps required. If your next flood insurance premium comes due in May or June (as many do), you have some time to act, but if your renewal comes sooner, you'll have to move more quickly.

FEMA says many affected property owners should be eligible for a refund of their 2001 flood insurance premium if their policies were issued by the National Flood Insurance Program in response to a lender's requirement for flood insurance. Under FEMA's rules, homeowners can request a refund of their final flood insurance premium paid for the policy year in which FEMA revises its flood risk maps.

Here's a summary of the process (with details following below):

Affected property owners who ask for and obtain their lender's written permission can cancel their flood insurance coverage;

Property owners who meet federal eligibility criteria qualify for a one-year refund of their flood insurance premium;

Although the federal government no longer requires flood insurance in these affected areas, property owners must continue to carry the coverage until (1) they request from their lender, in writing, a release form the flood insurance mandate and (2) their lender provides them with a written waiver from the flood insurance purchase requirement.

In either case, there are specific steps property owners must take. They're burdensome, they're required by the feds (not by City Hall or us) and there's really no way to avoid them.

As a public service, LBReport.com has posted on a link below a printable version (pdf format) of FEMA's "Letter of Map Revision," the legal document that you'll need to start the process of requesting your refund. (Tell your friends about LBReport.com and they'll thank you.)

The FEMA document revises FEMA's flood maps to remove the areas were designated at 100 year flood risk in July, 1998. We have posted it in printable pdf form at FEMA Letter of Map Revision, effective Jan. 11, 2002. (3 pages, approx. 380 kB.) We suggest saving it and printing it later. (If you have trouble viewing or printing this, please email us at "mail@lbreport.com")

Armed with this FEMA document, you can begin the process of attempting to cancel your flood insurance coverage (if you wish) and trying to get a refund for the last premium paid.

We've posted a link to a useful City Hall produced flood insurance information page which includes a list of upcoming community meetings on flood insurance, plus an address lookup feature and a link to a "How to" guide on the proper procedure to cancel one's flood insurance. Clicking on the following link should open a separate window to this page; to return to LBReport.com, simply close the City Hall window. City of LB flood insurance information page

We've also posted a link directly to the City Hall-prepared "How To" guide. Clicking on the following link should open a separate window; to return here, just close the "How to" guide window) at: How To Cancel Your Flood Insurance Policy

City Hall plans to mail the "How To" guide and additional information in packets to roughly 38,000 property owners affected. The packets will include the cover page (the required part) of FEMA's Letter, the How To guide and other materials.

The City of LB is not legally required to conduct a public information campaign, and many cities don't (leaving property owners to fend for themselves.)

In addition to holding outreach community meetings, the City is providing information in "The Wave" (the publication included in utility tax bills), telecasting info on Cable Channel 21 in addition to the materials posted on the City Hall's web site (www.ci.long-beach.ca.us).

And City Hall has also set up a telephone hotline: (562) 570-6784.

The steps required to properly cancel your coverage and request a refund are not required by City Hall but by the feds. In our opinion, taxpayers should not be forced to jump through as many hoops as are required, but at least you'll know what they are. Basically, to request a refund, property owners must:

Write a letter to their lender, attach a copy of the first page of FEMA's LOMR, ask the lender to make a new flood insurance determination and request the lender's permission to cancel the flood insurance policy. The property owner must ask the lender to state in writing that (1) flood insurance was required as a condition of the mortgage and (2) the lender no longer requires flood insurance on the property. Property owners should ask their lender for a one-year refund of their flood insurance premium. The individual property owner's lender or insurance agent (whichever handles the individual's flood insurance) must determine whether the property owner is eligible for the refund.

Obtain a letter from the lender acknowledging the lender's approval to end the insurance requirement for the loan. Caveat: lenders can require flood insurance on their own even though it's no longer federally required; we're told that as a practical matter, most don't. If the lender grants the cancellation request, it should do so with a written waiver of the flood insurance requirement. (If the lender denies the request to cancel coverage, you won't be able to cancel your flood insurance or be eligible for a flood insurance premium refund and there's no FEMA process to appeal the lender's decision.)

If the lender approves the request to drop the flood insurance coverage, ask the insurance agent or lender (whichever handles your flood insurance) if he/she requires additional paperwork. Some lenders or insurance agents will require owners to sign a cancellation request form to finalize the flood insurance cancellation process. (This is separate from your own request to the lender to cancel your flood insurance coverage.)

Obviously, it's wise to keep a file with copies of everything you send and receive.

Quick reference (unofficial) maps

For reference, we've also posted in pdf form some quick reference (unofficial) maps prepared by City Hall's Dept. of Public Works showing FEMA's 100 year flood zone areas for ELB and NLB/WLB, before and after Jan. 11, 2002.

Maps before Jan. 11, 2002.

ELB "100 year" flood zone areas before Jan 11, 2002. (Approx. 1.5 MB) The red areas (in this map and the next one) have been removed from FEMA's 100-year flood hazard zone and flood insurance is no longer federally mandated. (If you're in these areas, congratulations.)

NLB/WLB "100 year" flood zone areas before Jan. 11, 2002. (Approx. 500 kb) The green areas (in this and the preceding map) were in a FEMA designated flood zone prior to July 1998 for reasons not involving the LA river or LACDA project and thus remain a FEMA designated flood hazard zone where flood insurance is federally mandated.

Maps after Jan. 11, 2002

ELB, after Jan. 11, 2002 ELB low risk flood zone restored (approx. 1.5 MB).

NLB/WLB after Jan. 11, 2002 NLB low risk flood zone restored (approx 500 kB).

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