The floodwaters that recently raged in and around Boulder, Colo., caused millions of dollars in property damage, cost at least eight people their lives and could result in some new mortgage guidelines according to one local observer.
“There’s going to be changes across the industry,” said Boulder mortgage professional Marc Jalbert. “There have to be.”
Most of the homes and businesses that were slammed in the flooding didn’t carry flood insurance — due primarily to the fact that most were not in flood zones, according to Jalbert.Boulder County has 4,779 flood insurance policies according to the Federal Emergency Management Agency but the county is home to more than 77,000 detached single-family homes, census data show.
“A lot of people are going to look a lot more closely at the insurance options they have” and take a hard look at carrying some flood insurance, said Jalbert who is a loan specialist in the Boulder office of Colonial National Mortgage.
Local insurance agent Doug Bollman of Boulder-based Taggart Insurance agreed: “I think (flood insurance) is a question we’re probably going to see a lot more of,” he said.
But Jalbert said the re-evaluation process would extend beyond just what the consumer was mulling. “There’s no doubt that (Colonial National) is going to take a much more comprehensive look at insurance policies,” he said adding that he thought that more stringent insurance guidelines could be in the offing from higher up the chain.
Currently any homeowner with a mortgage backed by the federal government, most often through Freddie Mac or Fannie Mae, in a high-risk flood area must have flood insurance but FEMA says consumers should consider flood insurance even if they're not in a mapped flood plain. Typically, 25% of damages occur outside of high-risk areas, according to FEMA.
“We know that Fannie Mae and Freddie Mac are probably going to step in and make some interesting adjustments to the origination process in light of these kinds of disasters,”Said Jalbert.
But no new insurance requirements could change the human element of the mortgage professional’s job. “When the flooding happened …we had people pounding on our door (the next day) trying to figure out what to do with their mortgage.” Said Jalbert. “In Boulder, I think every other person you see on the street is a psychotherapist and a lot of these folks are my friends. We joke all the time that I provide a similar level of service.”
Julie Metish, who manages Taggart Insurance’s personal lines said that the human element is very important when catastrophe calls. It’s good “just being able to just walk people through the process (of filing claims, working with adjusters or even wading into FEMA bureaucracy),” Metish said. “People appreciate having someone local, that they know” to lean on.
And that, of course, can be a two-way street as it can get draining hearing from so many distraught people.
“We’re trying to take care of our customers as best as we can,” said Jalbert. “A lot of what we’re doing here is just counseling.”
Added Tamara McGrew from Taggart: “By the end of the day most days (during and after the historic flooding) we all felt like we could probably cry just hearing the devastation from our clients. It’s heart wrenching.”
For more on the devastating impacts of the Colorado floods, please see MPA TV