FEMA's National Flood Insurance Program (NFIP)

Being prepared for a flood includes having flood insurance.  With floods, there is usually some resulting loss or damage of property. Unfortunately, homeowners’ insurance policies do not cover flood damage. However, this coverage is available under the NFIP for participating communities such as the County of San Diego.

In 1968, Congress created the National Flood Insurance Program (NFIP) in response to the rising cost of taxpayer-funded disaster relief for flood victims, and the increasing amount of damage caused by floods.  The NFIP makes federally backed flood insurance available in communities that agree to adopt and enforce floodplain management ordinances to reduce future flood damage.  Federal flood insurance is available in more than 20,000 communities across the United States and its territories.

The NFIP is managed by the Federal Emergency Management Agency's Federal Insurance Administration  and Mitigation Directorate.  The Federal Insurance Administration manages the insurance component of the NFIP, and works closely with FEMA's Mitigation Directorate, which oversees the floodplain management aspect of the program.

The NFIP, through partnerships with communities, the insurance industry, and the lending industry, helps reduce flood damage by nearly $800 million a year.  Further, buildings constructed in compliance with NFIP building standards suffer 77 percent less damage annually than those not built in compliance. Every $3 paid in flood insurance claims saves $1 in disaster assistance payments.

The NFIP is self-supporting for the average historical loss year, which means that operating expenses and flood insurance claims are not paid for by the taxpayer, but through premiums collected as flood insurance policies.

Top 10 Facts Everyone Should Know About Flood Insurance

1.      Over 25 percent of all flood insurance claims occur in areas outside the floodplain

2.      Flood damage is not covered by homeowners policies.

3.      You can buy flood insurance no matter what your flood risk.

4.      There is a low-cost policy for homes in low to moderate risk areas.

5.      Flood insurance is affordable.

6.      Flood insurance is easy to get.

7.      Contents coverage is separate, so renters can insure their belongings too.

8.      Up to a total of $1 million of flood insurance coverage is available for non-residential
         buildings and contents.

9.      There is usually a 30-day waiting period before the coverage goes into effect.

10.    Federal disaster assistance is not the answer.

Source: FEMA: NFIP

Financial Assistance for Property Protection

FEMA provides grants, in certain situations, for property protection measures that reduce disaster losses and protect life and property from future disaster damages. Projects must provide a long-term solution to a problem, for example, elevation of a home to reduce the risk of flood damages as opposed to buying sandbags and pumps to fight the flood.

Currently, FEMA administers the Hazard Mitigation Grant Program, the Flood Mitigation Assistance program, the Pre-Disaster Mitigation Grant program, the Repetitive Flood Claims program, and the Severe Repetitive Loss program. These grants are made to the state or local government rather than to the homeowner directly and often have a cost-share requirement, which may have to be met by the homeowner.

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