Federal Flood Insurance refers to the coverage available for residents and businesses in flood-prone areas under the National Flood Insurance Program (NFIP), which was established by the National Flood Insurance Act of 1968.
The main objectives of the NFIP are to:
- Provide Flood Insurance: To make flood insurance available to properties where adequate coverage could not previously be obtained.
- Encourage Risk Management: To enforce building and zoning regulations that help minimize flood damage.
- Mitigate Future Risks: To develop and enforce floodplain management standards and reduce costs of future flood disasters to federal and state governments.
Key Features
Coverage Limits: Residential properties can receive up to $250,000 in building coverage and $100,000 for contents. Business properties have different coverage limits; details can be acquired from the policy provider or NFIP guides.
Eligibility: Coverage is available to properties within communities that participate in the NFIP. These communities must enforce certain floodplain management ordinances and meet additional criteria for risk prevention.
Premiums: Premium costs vary depending on factors such as location, age of building, building occupancy, and risks of flooding. Flood risk maps provided by FEMA can help determine these levels.
FEMA and NFIP: Overseeing body FEMA (Federal Emergency Management Agency) is composed and governs not just the operations of the NFIP but also integral in preparing the nation against future risks through sound science and floodplain management.
Coverage Exceptions
- Policies generally exclude factors such as moisture or mildew damage which is not directly related to a flood event.
