ABSTRACT

National Flood Insurance Program: The Current Rating Structure and Risk Rating 2.0 [Updated April 4, 2022]   [open pdf - 1MB]

From the Summary: "The National Flood Insurance Program (NFIP) is the primary source of flood insurance coverage for residential properties in the United States, with more than 5 million policies in over 22,000 communities in 56 states and jurisdictions. FEMA is in the process of introducing the biggest change to the way the NFIP calculates flood insurance premiums, known as Risk Rating 2.0, since the inception of the NFIP in 1968. The new premium rates went into effect on October 1, 2021, for new NFIP policies only. The new rates for existing NFIP policyholders took effect on April 1, 2022. Risk Rating 2.0 will continue the overall policy of phasing out NFIP subsidies, which began with the Biggert-Waters Flood Insurance Reform Act of 2012 and continued with the Homeowner Flood Insurance Affordability Act of 2014. Under the change, premiums for individual properties will be tied to their actual flood risk. Because the limitations on annual premium increases are set in statute, Risk Rating 2.0 will not be able to increase rates faster than the existing limit for primary residences of 5%-18% increase per year."

Report Number:
CRS Report for Congress, R45999
Author:
Publisher:
Date:
2022-04-04
Copyright:
Public Domain
Retrieved From:
Congressional Research Service: https://crsreports.congress.gov/
Format:
pdf
Media Type:
application/pdf
URL:
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