FEMA Has Postponed Changes to Flood Insurance Program

Florida is home to 35% of all flood insurance policies underwritten by the federal government. The National Flood Insurance Program, part of FEMA, has pushed back its planned changes to the program. The original effective date of Oct. 1, 2020, has been moved back one year to Oct. 1, 2021. Known as the Risk Rating 2.0 program, it’s expected to change the way NFIP calculates flood-insurance rates. As a result, some homeowners will most likely save money while other will pay more for their flood insurance.

The proposed program could operate more like traditional property insurance by weighing a variety of risk variables. Rates are now generally based on the amount of coverage a homeowner wants and if the home is inside or outside a FEMA-designated flood zone.

FEMA is considering variables including the potential for risk from hurricanes in the area, how far a home is from water, and the possibility of coastal surges. It could also include using new technology that predicts the risk from climate change at the home’s location.

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