Flood Insurance Policyholders May Get Funding

Recovery officials want Floridians to know that a substantial source of potential risk-reduction funding is built into most National Flood Insurance Program (NFIP) policies.

Florida NFIP policyholders who sustained substantial flood damage or a repetition of previous flooding damage due to Tropical Storm Fay may be eligible for financial help of up to $30,000 to assist in paying the cost of bringing their homes and businesses into compliance with floodplain ordinances.

Increased Cost of Compliance (ICC) coverage is targeted for structures located in a mapped floodplain in a participating community that have been severely or repeatedly flooded. To meet flood-safe codes, these vulnerable properties may need to be elevated, relocated - or flood-proofed in the case of commercial structures. ICC funding helps with these costs.

The application process requires the participation of the homeowner, local code enforcement officials and the insurance agent. The homeowner begins the process by notifying local code enforcement officials about the type and amount of structural damage. This triggers a damage assessment by local authorities.

Eligibility to file for the increased coverage occurs if a community floodplain administrator determines one of the following:

• The property is substantially damaged. This means designated local officials agree the cost to repair a flooded building is 50% or more of its pre-disaster market value.
• The property sustained repetitive damage. This term applies to homes or businesses that were damaged by flooding twice in the past 10 years, where the cost of repairing the flood damage, on average, equaled or exceeded 25% of the property market value at the time of each flood. Also, there must have been flood insurance claim payments for each of the two flood losses and the community’s floodplain management ordinance must have a repetitive loss provision.

The ICC claim is filed separately from any insurance claim for flood damage, although it is part of the same policy and is filed with the same insurance company. The risk-reduction funding is over and above any claim settlement from flood insurance policies and subject to the NFIP statutory limits of $250,000 residential and $500,000 commercial coverage.

Property owners can purchase flood insurance through most major insurance carriers who sell homeowners’ or business policies, or by calling the NFIP at 800-427-4661.