Summary of 2018-2019 NFIP Flood Insurance Changes

Summary of NFIP Program Changes

by Matt Lehn

The National Flood Insurance Program (NFIP) just announced changes effective April 1, 2018 and January 9, 2019. The changes outlined below apply to new business and renewals that will become effective on or after April 1, 2018. The premium changes for Preferred Risk Policies (PRPs) and Newly Mapped procedure policies will become effective January 1, 2019.

Premium Increases and Surcharges

Average increase of 8%. These amounts do not include the HFIAA surcharge or the Federal Policy Fee (FPF).

For policies issued on or after April 1, 2018, there will be no changes to:

Deductible Factors

Federal Policy Fee

Reserve Fund Assessment

HFIAA Surcharge

Probation Surcharge

ICC Premiums

Pre-FIRM Subsidized Policies (a group of policies in SFHA Zones A, AO, AH, A1-30, AE, A99, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, V1-30, and VE, that receive rates insufficient to pay the anticipated losses and expenses for that group)

Other Pre-FIRM Subsidized Policies Not Subject to 25% Annual Increases: These are primarily condominium policies and multifamily policies. Premiums will increase 5%, with a total increase of 5%.

V Zones (coastal high-velocity zones)

Rate increases are being implemented again this year as a result of the Heinz Center’s Erosion Zone Study, which clearly indicates that current rates significantly underestimate the increasing hazard from steadily eroding coastlines.

Post-FIRM V Zones: Premiums will increase 11%, with a total increase of 11%.

A Zones (non-velocity zones, which are primarily riverine zones)

Post-FIRM AE Zones: Premiums will increase 1%, with a total increase of 1%.

AH, Zones (shallow flooding zones): Premiums will remain unchanged.

X Zones (zones outside the Special Flood Hazard Area)

Standard-Rated Policies: Premiums will increase 2%, with a total increase of 1%.