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Flood Insurance Rules and Legislation

Legislative Reform

Affordability Framework

Rates & Refunds

NFIP Communities

Congress established the National Flood Insurance Program (NFIP) with the passage of the National Flood Insurance Act of 1968. Since the inception of NFIP, additional legislation has been enacted. The NFIP goes through periodic Congressional reauthorization to renew the NFIP’s statutory authority to operate.

Flood Insurance Legislative Reform

Congress made major changes to the program in 1973, 1994, 2004, 2012 and 2014, with the goals of strengthening the program, ensuring its fiscal soundness, and informing the public of its mapping and insurance rate-setting through expert consultation, reports and studies.

Recent Reports and Studies


The NFIP Affordability Framework

In 2018, FEMA engaged the broader policy community, including academia and other government agencies, and developed an affordability framework, in response to a congressional mandate.

Under the Biggert-Waters Flood Insurance Reform Act of 2012 (BW-12), Congress sought to build a more sound financial framework for the NFIP by directing FEMA to remove the discounts for some policyholders with homes insured by the NFIP, so that policyholders would be given flood insurance rates that more accurately reflected their expected flood losses. At that time, Congress recognized that removing discounts might cause flood insurance to become unaffordable for some households and mandated in BW-12 that FEMA study flood insurance affordability to address that concern.

Because of concerns about rising premiums from constituents in multiple communities, Congress later passed the Homeowner Flood Insurance Affordability Act of 2014 (HFIAA), which rolled back some of the changes implemented under BW-12 and recognized additional affordability challenges associated with increased premiums required by the BW-12 implementation. HFIAA mandated that FEMA develop an affordability framework aimed at providing targeted assistance for policyholders in addition to dealing with BW-12 affordability requirements.

Rates and Refunds

The changes in 2014 restored grandfathered rates and repealed certain rate increases to also address the cost concerns. HFIAA also applied an annual surcharge for all policyholders in the amount of $25 per year for renters and owners of primary residences and $250 per year for owners of non-primary residences and non-residential buildings.

The agency has worked closely with its Direct Servicing Agent (DSA) and Write Your Own (WYO) program participating insurance companies to implement this legislation.

For more information about subsidized rates and reducing insurance costs, please visit Agents.FloodSmart.gov to learn more about map updates, grandfathering, and the newly mapped procedure.

NFIP Communities

Community Rating System

The Community Rating System is a voluntary incentive program that recognizes and encourages community floodplain management activities that exceed the minimum program requirements.

Community Status Book

The status of whether a community participates in, or is suspended/sanctioned from, the NFIP is published in the Community Status Book. The NFIP status has implications for disaster assistance to the community and to its citizens.