National Flood Insurance Program (NFIP) offers federal flood insurance to homeowners, renters, and business owners if their community participates in the NFIP. It seeks to reduce the impact caused due to flooding through flood insurance and community floodplain regulations.
NFIP was created by U.S. Congress in 1968 and is managed by Federal Emergency Management Agency (FEMA).
Under NFIP, FEMA offers federally backed flood insurance in participating communities. The insurance may cover both property and the contents. FEMA does not directly sell insurance to homeowners; instead, flood insurance is provided to homeowners through flood insurance agents. Since 1978, the NFIP has paid nearly $50 billion for flood insurance claims and related costs (as of 2/17/15). The flood insurance offered by FEMA through NFIP is an important tool in managing the flood risk.
For a community to participate in NFIP, FEMA requires the community to adopt ordinances that meet or exceed FEMA requirements to reduce the risk of flooding. These may entail incorporating NFIP requirements into zoning codes, subdivision ordinances, building codes, or adopt special purpose floodplain management ordinances.
Flood insurance can be provided by NFIP if the community participates in NFIP. FEMA defines community as "any State, or area or political subdivision thereof, or any Indian tribe or authorized tribal organization or Alaska Native village or authorized native organization, which has authority to adopt and enforce floodplain management regulations for the areas within its jurisdiction." There are two broad steps through which a community participates in the NFIP, which are listed below.
Every building located in a participating community may be covered by a flood insurance policy. The insurance is sold through insurance agents. Through insurance, NFIP is mitigating the loss incurred by the homeowner. At the same time, by requiring the community to enforce standards that reduce flood loss, the NFIP is reducing the actual loss that may be incurred on the property.
You are eligible to purchase flood insurance as long as your community participates in the NFIP. Check the Community Status Book to see if your community is participating in NFIP.
Updated: Nov 04, 2015