fbpx
Client Login

Keep up to date

Subscribe to the INSURICA blog and receive the latest news direct to your inbox.

Subscribe to the blog

FEMA Flood Risk Rating Changes

Atlantic hurricane season is underway, but it doesn’t take a hurricane to cause a flood event. Flooding tops the list as the most common natural disaster in the United States and can happen anywhere. The aftermath of a flood event can be devastating emotionally and financially. The Federal Emergency Management Agency (FEMA) says just one inch of water in a structure can cause up to $25,000 of damage.

Even if your home or business isn’t near a flood zone, securing an adequate flood insurance policy could be a lifesaver when dealing with a natural disaster. FEMA is launching a program this fall that could change how homeowners pay for their flood insurance policies.

FEMA will roll out a new rating system for the National Flood Insurance Program (NFIP), Risk Rating 2.0.

According to FEMA, Risk Rating 2.0 allows the agency to better inform individuals and communities about flood risk, set premiums to signal those risks, and promote actions to mitigate against them. Individuals will no longer pay more than their fair share in flood insurance premiums.

Here’s what you need to know about Risk Rating 2.0:

  • In Phase I: New policies beginning Oct. 1, 2021, will be subject to the Risk Rating 2.0 rating method. Also, beginning Oct. 1, existing policyholders eligible for renewal will take advantage of immediate decreases in their premiums.  
  • In Phase II: All policies renewing on or after April 1, 2022, will be subject to the Risk Rating 2.0 rating method. 

Conclusion 

The NFIP’s current rating methodology has not changed since the 1970s and does not consider individual flood risk and underlying home values. Risk Rating 2.0 will change the way FEMA views flood risk and prices flood insurance.

FEMA continues to engage with Congress, its industry partners and state, local, tribal and territorial agencies to ensure clear understanding of these changes.

It’s critical to work with industry experts who have the necessary knowledge and experience.

Contact a team member near you at INSURICA.com/our-team to learn more about flood insurance or assist you with your current policy.

About the Author

INSURICA
INSURICA

Share This Story

Keep up to date

Subscribe to the INSURICA blog and receive the latest news direct to your inbox.

Subscribe to the blog

Related Blogs

Preparing Your Business for Wildfire Season

July 23rd, 2021|Blog, Commercial Insurance, Safety Tips, Small Business|

Wildfires may strike without a warning at any time, so it is critical to prepare your business before and after the catastrophe. Take proactive steps to keep everyone safe and time for your emergency plans to be reviewed and revised.

Medical Marijuana Legal and Financial Risks That Are Commonly Faced

July 19th, 2021|Blog, Commercial Insurance, Small Business|

Dispensary owners need to be careful that they adequately protect themselves from both the legal and financial risks that are commonly faced by those in the medical marijuana industry.

Go to Top