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FEMA's changes to flood insurance may make rates more fair, but they'll cost most Tennesseans more

72% of policyholders to pay more as of April 1
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NASHVILLE, Tenn. (WTVF) — Most Tennessee homeowners with flood insurance will need to fork over more money every month under FEMA's new insurance policies.

FEMA updates its flood insurance rates once a year, and this year 72% of Tennesseans are having to pay more, according to QuoteWizard.

"You are now going to be paying for the risk that you face," said Nick VanZant, a research analyst and insurance expert at QuoteWizard. "Your neighbor isn't going to be covering you anymore. So, if you have a big house next to the water, you're going to be paying a lot more."

The changes took effect on April 1. They affect more than 27,500 people in Tennessee.

FEMA actually completely overhauled its formula this year. Before, the rates were based on the size of your home and your general location. Now, it's the exact flood risk at your address and the cost to rebuild your property.

"What FEMA is really doing is they're shifting the cost to the riskiest places. So if you live in one of these areas that doesn't flood very much, you're not going to be paying for the beachfront mansions anymore. It's really a fair way to do things," VanZant said.

While 28% of Tennesseans will be paying less, those that are paying more can expect to pay — on average — $10 extra every month. Although, some homeowners in Nashville and Chattanooga are paying $100 more per month.

VanZant says the only way to escape the new rates is to move.

"Under the new realities of climate change, and the fact that these floods are happening more and more and more, flood insurance has to change to keep up with that, and if you live in one of these risky areas, your flood insurance can go up 18% every single year. This is a problem that is not going away, and there is not really a way you're going to be able to save money if you're living in one of these flood-prone areas other than to move out of it," he said.