On Wednesday, November 1, 2023, Los Angeles County held a virtual workshop for floodplain managers. Below is a link to the powerpoint presentation.
FEMA National Flood Insurance Program (NFIP) Overview Presentation
Questions and Answers:
Q: Why is flood insurance so important?
A: Flooding and cyclone events (e.g., hurricanes) are the costliest and most common disasters in the U.S., with 99% of counties in the U.S. having experienced a flood. Most property and renters' insurance policies do not cover flooding. If a flood were to occur, only flood insurance would cover the cost of damage and help policyholders get back to their routines more quickly. When consumers consider whether to purchase flood insurance, here are some improtant facts they should know:
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Any eligible building in an NFIP participating community can be covered by flood insurance.
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On average, about 40% of NFIP flood insurance claims come from outside teh high-risk flood zones known as Special Flood Hazard Areas (SFHAs).
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Flood insurance can pay a claim regardless of whether or not there is a presidentially declared disaster.
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Federal disaster assistance typically comes in the form of a Small Business Administration (SBA) loan that must be repaid with interest or as a FEMA grant through the Individuals and Households Program (IHP), which does not compensate for all losses caused by a disaster.
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The average flood insurance claim payment from 2016 to 2021 was about $66,000.
Q: What are flood maps and how are they used?
A: Flood Insurance Rate Maps (FIRMs) are the official community maps used as guides to indicate flood risk. Several levels of flood hazards are identified on these maps, including hazard areas. Areas not yet identified by a flood map may be mapped on FHBMs prior to a flood map being produced. Flood maps help us understand risks but are only part of the story. For example:
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Community officials use flood maps to understand and communicate local flood risk, manage floodplains, and require new and substantially improved buildings be built to mitigate losses from future floods. These efforts help make a more resilient community in which to live and work.
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Mortgage lenders use flood maps to determine a property's flood risk and decide whether to require flood insurance as a condition of a loan. Lenders generally require homeowners and business owners inside SFHAs to purchase flood insurance if they have a government-backed loan on the building, also known as the mandatory purchase requirement.
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Insurance professionals use the maps to help residents in all hazard areas protect their assets.
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Developers and builders use maps as part of location siting and construction decisions.
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Real estate professionals use maps to help clients make informed decisions about buying or selling a property, ensuring there are no surprises at the time of closing.
Q: What are the rating factors and what goes into the cost of premiums?
A: NFIP flood policy costs for a structure include:
Where it's built: Building Address, Distance to Flooding Source, and Building Elevation
How it's built: Construction Type, Foundation Type, Number of Floors, First Floor Height
What is built: Replacement Cost Value, Coverages and Deductible Amounts, Prior NFIP Claims History
Please see NFIP's Pricing Approach | FEMA.gov for more information.
Q: What are the ways to lower the premium?
A: Your insurance premium is based on a number of factors, but there are a few key actions you can take to pay less for flood insurance each year: Lower your floor risk, choose a higher deductible, provide an elevation certificate, encourage your local community to mitigate risk.
Please see | Reduce Risks, Cut Cost of Flood Insurance (floodsmart.gov) for more information.
Q: How can you buy insurance outside of the NFIP?
A: Currently, the only way to obtain a quote for flood insurance is through a local insurance agent. FEMA does not sell or service NFIP policies directly. Your insurance agent can give you a quote for a NFIP policy and private flood insurance so that you can compare premiums and coverages. Your insurance agent can also provide you with a quote for excess flood insurance coverage above the maximum amounts available under the NFIP. Excess flood coverage is provided by the private flood market.
To purchase flood insurance, call your insurance company or insurance agent, the same person who sells your home or auto insurance. If you need help finding a provider go to FloodSmart.gov/flood-insurance-provider or call the NFIP at 877-336-2627.
Q: Recently, certain insurance companies will no longer insure certain homes in California. How does this affect flood insurance policies?
A: This trend of home insurance policy non-renewals or no new policies in California has no bearing on flood insurance available through the NFIP. The NFIP provides flood insurance to property owners, renters, and businesses, and having this coverage helps them recover faster when floodwaters recede. The NFIP works with communities required to adopt and enforce floodplain management regulations that help mitigate flooding effects.
Flood insurance is available to anyone living in one of the almost 23,000 participating NFIP communities. Homes and businesses in high-risk flood areas with mortgages from government-backed lenders are required to have flood insurance.
Please see Flood Insurance | FEMA.gov for more information.