What You Need to Know on Sarasota Real Estate Flood Insurance


SARASOTA, FLORIDA, May 22nd, 2014 – Congress approved this January a stop-gap measure to delay the implementation of the increases in flood insurance premium to homeowners. Adopted under the $1-trillion government spending bill, this remedy is however only for the short-term and will only defer the rate hikes’ implementation for at least nine months. This will hopefully buy Congress enough time to mull over a more wide-ranging reform bill designed to delay implementation for four years.

The hanging concern on flood insurance costs makes it important for prospective buyers of homes for sale in Sarasota and elsewhere in Florida to avail of the services of a real estate agent knowledgeable on the issue and its local impact. It is estimated that close to 270,000 flood insurance policy holders in Florida stand to bear the burden of the rate hikes.

Reading the FEMA flood map


The rate increases range between 20% and 400%, some of which were already imposed in October as provided under the Flood Insurance Reform Act of 2012. This legislation terminates subsidized insurance for homes covered under the National Flood Insurance Program (NFIP). The increase in the premium rates were designed to reflect the true risk of living in high-flood hazard areas and thus ensure long-term financial stability for the NFIP.

The legislation also mandates the Federal Energy Management Agency (FEMA) to update flood maps across the U.S. Besides coastal areas of Florida, New Jersey, New York, Texas and Louisiana, inland states vulnerable to river flooding are also covered by the mapping update.

For prospective home buyers, the FEMA flood hazard data for the communities where they are considering home purchase would be important inputs as they consult with their realtors on home purchase options. The agency’s flood insurance rate map (FIRM), for instance, is one basic reference material to consider. It shows the special flood hazard areas and sets the risk premium zones that apply to a certain community. These risk zones form the bases for setting flood insurance coverage premium rates offered through the NFIP. A link to a basic flood map can be found below.

Where the vulnerable areas are

Broadly, the FEMA flood hazard map for Sarasota County identifies five zones. The first is zone A which is described as having 100-year flood hazard. Three zones—AE, AH, and AO—are areas with 100-year flood depths up to 3 feet. Then, there’s zone VE which can experience coastal flooding from wind and wave action.

Generally, communities along the coastline of Sarasota Bay as well as those on nearby barrier islands or keys fall under the zone VE. Inland, communities around Phillipi Creek and Whitaker Bayou are also vulnerable to flooding particularly during the hurricane season which can stretch from June up to November.

Disadvantage for sellers

With this scenario, the increased flood insurance premiums will affect waterfront luxury residences as well as homes up to the lower-end communities. The higher insurance rates can also negatively impact upon homeowners who drop their coverage to avoid the higher premiums.

It would be more difficult to market their properties should they decide to sell their residences. This is because the buyers must pay the “full risk rate,” instead of having the new flood rates phased in with the purchase.

View Flood Zone Map: CLICK HERE