Reducing future flood damage
If your home or business is damaged by a flood, you may be required to meet certain building requirements in your community to reduce future flood damage before you rebuild or repair.
To help you cover the costs of bringing your home or business into compliance, the National Flood Insurance Program (NFIP) offers eligible policyholders up to $30,000 of Increased Cost of Compliance (ICC) coverage.
Flood insurance policyholders in high-risk flood areas may receive up to $30,000 to help offset the costs to bring their home or business into compliance with their local community’s floodplain management ordinance or regulations.
There are four options you can choose, or any combination of, to help you reduce future flood damage.
You should consult with your local floodplain administrator to help determine which option is best for your property:
- Elevation: Raising your home or business to or above the flood elevation level adopted by your community.
- Relocation: Moving your home or business out of harm's way.
- Demolition: Tearing down and removing flood-damaged buildings.
- Floodproofing: This option is available primarily for non-residential buildings. It involves making a building watertight through a combination of adjustments or additions of features to the building that reduces the potential for flood damage.
If you receive a declaration from your local floodplain administrator that your home is substantially or repetitively damaged, you may file a claim for your ICC coverage.
- Substantial damage: If your community determines that your home or business is damaged by flood to the point that repairs will cost 50% or more of the building’s pre-damage market value.
- Repetitive damage: If your community has a repetitive loss provision in its floodplain management ordinance and determines that your home or business was damaged by a flood two times in the past 10 years, where the cost of repairing the flood damage on average equaled or exceeded 25% of its market value at the time of each flood. There must be flood insurance claim payments for each of the two losses.
Your ICC claim is adjusted separately from the flood damage claim.
You can only file an ICC claim if your community determines that your home or business has been substantially or repetitively damaged by a flood. This determination is made when you apply for a building permit to begin repairing your home or business.
If your community does determine that your home or business is substantially or repetitively damaged, a local official will explain the floodplain management ordinance provisions that you will have to meet.
Once your community has made this determination, contact the insurance company or agent who wrote your flood policy to file an ICC claim.
Your insurer will assign a claims representative who will help you process your ICC claim. You should start getting estimates from contractors to take the necessary steps to elevate, relocate, demolish, or floodproof.
You may be able to receive a partial advance payment of up to $15,000 once your claims representative has a copy of the signed contract for the work, a permit from the community to do the work, and a return of your signed ICC Proof of Loss. If the work is not completed, you must return any partial payment to your insurer.
When the work is completed, local officials will inspect and issue a certificate of occupancy or a confirmation letter. Once you submit this document to your claims representative, your insurer will pay the final installment or full payment.
Learn more about ICC coverage
For more information on ICC coverage, call your insurance company or agent, or call the NFIP at 877-336-2726.
Additional information on increased cost of compliance can be found below: