FEMA Flood Insurance Guidelines

Flood insurance covers structural and personal property losses.

In 1968, the U.S. Congress passed the National Flood Insurance Act to lower the death and damage tolls of floods and reduce the federal government's disaster recovery outlays. The Act created the National Flood Insurance Program (NFIP) and established federal requirements for obtaining insurance through the program. Congress followed the Act in 1973 with the Flood Disaster Protection Act, which bolstered the 1968 legislation.

Flood Hazard Studies

The Federal Emergency Management Agency (FEMA) conducts flood hazard studies to determine which areas of the United States have the greatest flood risk. After data analysis, FEMA designates 100- and 500-year floodplains and special flood hazard areas, as well as low- and moderate-risk areas.

Flood Insurance Rate Maps

FEMA maps flood hazards on flood insurance rate maps to categorize at-risk areas according to their flood zone. The flood zones correspond to levels of flood risk. The NFIP bases premium rates on variables that include these risk levels.

A and V Zones

Properties in the high-risk and coastal high-risk A and V zones exhibit the highest probability of flooding (i.e., 1 percent annually). These areas have a 26-percent chance of flooding during the course of a 30-year mortgage. Properties in the coastal high-risk V zones have an additional risk of flooding from tidal surges. In NFIP-participating communities, federal law requires homeowners with a federally backed mortgage to purchase flood insurance.

B, C and X Zones

Properties in the low- and moderate-risk B, C and X zones reside outside the 100-year floodplain and inland. Some of these areas may experience periodic ponding or local flooding, but do not have the high probability of flooding that A and V experience. Property owners and renters who purchase flood insurance in these zones qualify for preferred premium rates.

Preferred vs. Standard Premiums

The NFIP generally offers preferred premiums to property owners or renters in low- or moderate-risk zones. Other homes may qualify for reduced premiums after completion of floodproofing. As of 2010, preferred premiums start at $39 per year for contents-only coverage. Homes in A and V zones qualify for standard rates only. These begin at $136 per year for contents-only coverage.

References

• "Cases and Materials in Land Use"; David L. Callies, Robert H. Freilich, Thomas E. Roberts; 1994
• Federal Emergency Management Agency: Answers to Questions about the National Flood Insurance Program
• Federal Emergency Management Agency: Definitions of FEMA Flood Zone Designations
• Floodsmart: Policy Rates