How map changes affect flood insurance
FEMA works with communities to map flood risk. When new flood maps become available, you might learn
that your flood risk has increased or decreased, which can affect what you pay for flood insurance.
However, there is usually a 6- to 12-month period between the time the new "preliminary" maps are issued
and the time that they become effective. This gives you adequate time to prepare for the new risk and
possibly save on flood insurance.
This chart explains different map-change scenarios:
|If Maps Show...
||These Requirements, Options and Savings Apply
|Change from low or moderate flood risk (Zones B, C, or X) to high risk (Zones A, AE, AR, A99, AH, or AO)
||Flood insurance is mandatory.
Flood insurance is federally required for most mortgage holders. Insurance costs may rise to
reflect the true (or high) risk.
Mapped procedure can offer savings.
The Newly Mapped procedure allows policyholders to purchase coverage at the lower-cost Preferred
Risk Policy (PRP) rate for the first 12 months after new maps go into effect. After the first
year, the rate begins its transition to a full-risk rate with annual rate increases of no more
than 18 percent each year.
"Grandfathering" can offer savings.
The NFIPâs Grandfather Rules recognizes policyholders who built in compliance with the flood map
in effect at the time of construction or who maintain continuous coverage. Sometimes, though,
using the new flood maps can actually result in a lower premium, especially if the home is high
enough above the Base Flood Elevation (BFE).
|Change from high flood risk (Zones A, AE, AR, A99, AH, or AO) to moderate to low risk (Zone X or Shaded X)
||Flood insurance is optional but recommended. The risk is only reduced, not removed.
You can still obtained flood insurance, and at a lower rate. Even though flood insurance isn't
federally required, everyone is financially vulnerable to floods. In fact, people outside of
mapped high-risk flood areas file more than 20 percent of all NFIP flood insurance claims and
receive one-third of Federal disaster assistance for flooding. When it's available, disaster
assistance is typically a loan that you must repay with interest.
Conversion offers savings.
Your insurance agent can easily convert an existing
policy to a lower-cost PRP if the building qualifies. Note that lenders always have the option
to require flood insurance in these areas.
|Increase in the Base Flood Elevation (BFE)
||An increase in BFE can result in higher premiums; however, grandfathering can offer savings.
The NFIP's Grandfather Rule allows policyholders who have built in compliance with the flood map
in effect at the time of construction to keep the earlier BFE to calculate their insurance rate.
This option could result in significant savings.
|No change in risk level
||No change in insurance rates.
However, this is a good time to review your coverage and ensure that your building and contents
are adequately protected.
When should you check for flood map changes for your area?
FEMA suggests the following:
- Home or business owners—Be sure to check with your agent at your yearly
renewal time or earlier if a map change is announced in your community.
- Insurance agents—At least once a month to stay informed of any changes and
how they will affect your clients.
- Realtors—When listing a house or showing a prospective buyer, check to see if
map changes are occurring that could change the level of flood risk on the property of interest.
- Lenders—When issuing or refinancing a mortgage to determine if flood
insurance is, or will be, required.
- Contractors—Before planning construction to help decide where and how to build.
Discover how the the Grandfather Rule and the
Newly Mapped procedure can
help you save money. >>