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8/20/2012 - Four changes from the flood insurance extension

An extension to the NFIP is in place.

With the recent reauthorization of the National Flood Insurance Program, several adjustments make the program slightly different. Insurance Journal has outlined what some of those are.

1. Higher minimum deductibles - One of the changes to the NFIP relates to the minimum deductible homeowners must pay before coverage kicks in. At renewal, minimum deductibles are $2,000, up from $1,000 last year.

2. Flood map review - Another change to the NFIP is the establishment of a technical map advisory council. This committee will help define major flood zones, helping homeowners determine the risk in their area. A map modernization process will be created as well.

3. End to business insurance subsidies - The subsidized rates paid by businesses are ending. Applicable to plans that may have lapsed due to the policyholder, businesses will be charged a rate equivalent to what other property owners in the area are charged.

4. Higher cap for premium increases - A higher ceiling will be placed on premium increases as well. Last year, rate increases were restricted to 10%, but the revised NFIP places caps at 20%.

The extension of the NFIP guarantees that the program will receive federal funding through September 30, 2017. If you have any questions specific to your flood policy, contact your flood insurance agent.

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