Separate and distinct from the NYC hurricane evacuation zone maps, flood risk maps are maintained by FEMA and are a primary factor in determining flood insurance requirements and costs. Flood protection is rarely covered by standard homeowners insurance, and must be purchased separately. If a building is located in a “flood plain” according to FEMA’s flood maps, flood insurance will be required by most lenders in order to qualify for a mortgage.
Since hurricane Sandy struck New York in 2012, FEMA has been in the process of reevaluating its flood maps, with preliminary releases indicating a significant increase in flood risk for certain areas of New York City. Based on these preliminary flood maps, some estimates project flood insurance costs increasing by a multiple of 15 or higher for the most severely affected properties. In order to protect homeowners from sky-rocketing insurance costs, in March 2014, the U.S. government signed the Homeowner Flood Insurance Affordability Act into law, limiting future increases to 18% annually for most properties. However, the long-term the effect of the revised flood maps remains unclear, and owners of flood plain properties face the risk of steady rate increases for years to come.