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The Watermark - National Flood Insurance Program Financial Statements

The Watermark is a quarterly report that provides transparency on the financial state of the National Flood Insurance Program (NFIP). This report provides information about the NFIP to interested groups and individuals, such as policyholders, industry partners and government officials.

Download the Latest Watermark - First Quarter FY2021


Current as of December 31, 2020

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Participating Communities

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Average Annual Premium
(Incl. Premium & Federal Policy Fee)

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$1.3 Trillion

Total Coverage of NFIP Policies

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5.032 Million

Number of NFIP Policies in Force

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$16.3 Billion

Capacity to Pay Claims

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$20.5 Billion

Outstanding Debt with Treasury

Featured News

The Office of the Flood Insurance Advocate (OFIA) embarked on a video production project to help NFIP customers with frequently misunderstood concepts. Existing material targeting insurance agents, adjusters, Write Your Own stakeholders or other technical audiences require an advanced level of familiarity with NFIP concepts. Confusion around certain flood insurance terminology was identified through OFIA’s casework and research. OFIA is seeking to address these common issues with straightforward and informative videos.

For the last four years, the Federal Insurance Directorate (FID) has approached policyholder claim appeals through the lens of the customer experience work started in 2017. During this time, the team recruited and trained talented staff, implemented iterative improvements to the appeals process, and used data to inform future areas of concern and opportunity. With a fully-staffed appeals branch to start 2021, we continue to refine our process and software to generate more efficient interactions with Write Your Own companies and policyholders. 

NFIP Available Funds - as of 12/31/2020

The NFIP’s Available Resources provides information similar to a “Balance Sheet” used in the private sector. It is a snapshot of the program’s finances, including any prior period carryover for the given period.

AVAILABLE RESOURCES ($ in Thousands)Sept. 30, 2020Dec. 31, 2020
Flood Fund Balance5,870,2955,769,587
Unpaid Obligations(698,057)(804,945)
Unpaid Loss & Loss Adjustment (Claims)(707,677)(549,823)
Mandatory Sequestration(90,093)(88,806)
Flood Fund Available Resources4,374,4684,326,012
Reserve Fund Balance531,138770,709
Net Investments1,579,8341,513,828
Outstanding Obligations(275,590)(186,009)
Reserve Fund Available Resources1,835,3822,098,528
Remaining Borrowing Authority9,900,0009,900,000
NFIP Total Capacity to Pay Claims *16,109,85016,324,541

* FEMA’s reinsurance placements augment the NFIP’s Available Resources. After qualifying losses for a single event exceed $4B, the NFIP may collect up to $2.53B should the event reach $10B in losses.

Statements of Operations - as of 12/31/2020

National Flood Insurance Fund ($ in Thousands)

REVENUEFY 2019FY 2020 FY 2021 Q1
Federal Policy Fee193,114191,19940,185
Other Revenue9,03910,2132,764
Total Flood Fund Revenue3,588,3293,711,552706,485
EXPENSESFY 2019FY 2020FY 2021 Q1
Total Loss & Loss Adjustment (Claims)1,884,3471,447,313503,860
Unpaid Loss & Loss Adjustment (Claims)*1,351,335(670,576)(211,784)
Write Your Own (WYO) Expense Allowance913,995901,715194,288
Interest Paid on Debt415,341438,412111,925
Floodplain Management & Mapping Activities147,204174,29543,329
Flood Related Grant Activities90,354121,29133,183
Other Expenses496,613266,83376,565
Total Flood Fund Expenses5,363,7642,736,945763,328
FLOOD FUND NET INCOME (LOSS)**(1,775,435)974,607(56,843)

National Flood Insurance Reserve Fund ($ in Thousands)

REVENUEFY 2019FY 2020FY 2021 Q1
Return on Investment17,45313,7431,093
Total Reserve Fund Revenue882,634935,904266,012
EXPENSESFY 2019FY 2020FY 2021 Q1
Total Loss & Loss Adjustment (Claims)000
Obligated But Not Expended27,07473,624(89,581)
Total Reserve Fund Expenses293,214359,3290
RESERVE FUND NET INCOME (LOSS)589,420576,575266,012

* In FY 2019, a new Federal Accounting Standard, Statement of Federal Financial Accounting Standards (SFFAS) 51 was issued that made changes to how claims are reported. SFFAS 51 gives guidance that claims must be reported at the time of occurrence. Unpaid Claims in this Watermark report show claims pursuant to SFFAS 51 and have been separated from Total Loss & Loss Adjustment. Unpaid claims include projections of claims reported, and projections of claims Incurred But Not Reported (IBNR), which is an estimate of claims not yet reported to insurance companies.

** The combination of Total Revenue and Total Expenses contribute to the Net Income or Net Losses for the NFIP. Because of the NFIP’s current structure of premium discounts, interest expenses on debt, and loss concentrations, Net Losses are anticipated.

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Last updated April 7, 2021