OC Flood Insurance Claims Much Lower Than Other Areas

OCEAN CITY — The merits of the Ocean City beach replenishment project got another proverbial leg to stand on when statistics found this week showed a tremendously low number of flood insurance claims have been actually been paid in the last 30 years.

The Dispatch obtained a spreadsheet that lists all of the state’s flood insurance statistics (by town and by county) including the number of claims, premiums and totals in both categories, and the numbers reveal that Ocean City actually pays more in flood insurance premiums in one year than the number of claims that have been paid since 1979.

Mayor Rick Meehan told the Tourism Commission at a recent meeting that Ocean City property owners pay about $7.5 million in flood insurance premiums each year, but noted that the total amount of claims paid to property owners in the resort since 1979 totals $6.957 million.

“It really shows just how vital the beach replenishment project has been for the residents and property owners of Ocean City,” said Meehan. “An even more interesting number is that since the project has been in place, none of those claims have been to properties on the oceanfront.”

What makes the analogy even more surprising, according to Meehan, is when one compares the statistics in Baltimore County and Anne Arundel County where the ratio in what has been paid in versus what has been paid out in claims is equally staggering.

“In Baltimore County, about $3.9 million is paid in each year, but the amount of claims that have been paid in that county since 1979 is almost $60 million,” said Meehan.

Records show that Anne Arundel County property owners spend just about the same amount annually in flood insurance premiums, but has been paid out more than $41 million in flood insurance claims in the last 30 years.

Kathy Fowler of Fowler Insurance in Ocean Pines was extremely surprised when hearing the statistical findings concerning flood insurance.

“I’m quite shocked by these numbers and I guess it tells me that the people in Baltimore County need to be paying more on their premiums and the dune system is doing its job in Ocean City,” she said.

Stephanie James of Atlantic/Smith, Cropper & Deeley was equally surprised with the numbers but said that the huge totals paid in the western portion of the state more than likely was directly linked to the lesser amount paid on the premium.

“If I were to really sit and do the math, it probably is a result in the lower flood insurance premiums that they are paying over there and the fact that they probably aren’t required to have it in Baltimore County,” said James. “Where we are on the peninsula, it’s required in some places and certainly the premiums are higher because of the risk.”

James also pointed to aging infrastructure and water main breaks in more urban areas as a main culprit in flood insurance claims in the western region of Maryland.

The Nor’Ida storm last November that many have called the “storm of the decade” destroyed almost half of the city’s dune system, which had been built up since the 1990’s through the beach replenishment program.

The Army Corps of Engineers estimated that it will take about $10 million to repair the damage to the dune and that will not include the $11 million that was already scheduled for beach replenishment in May.

Still, Meehan says that the most important number released since the storm is the recent one released by the Army Corps of Engineers that says what the damage would have been to oceanfront properties had the dune system not been in place.

“To my knowledge, we had practically no damage to any properties in Ocean City as a result of the November storm, but the Army Corps told [City Engineer] Terry {McGean] and I that had the dunes not been in place, the estimated cost of property damage would have been approximately $18.6 million,” Meehan said.

Fowler credits the dune system as well in saving the resort’s oceanfront properties, but noted that even in lower risk areas, she is surprised by how many people question the necessity of having flood insurance.

“People always tell me they don’t think they need it because they aren’t near water or high hazard areas, but 25 percent of all flooding happens in preferred risk areas that are not on the ocean or the bay,” said Fowler. “If you are going to spend $400,000 on a house, why wouldn’t you get flood insurance, because in most cases, it isn’t covered in your homeowner’s insurance.”

Both Fowler and Meehan agree however, that in this case, damaged dunes are preferred to damaged property.

“(The dunes) certainly got messed up in that storm, but they really protect Ocean City, and that’s what they are supposed to do,” said Fowler.

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