Spring is on the way, and so is another year of National Flood Insurance Program (NFIP) rate increases. On April 1, 2021, NFIP’s latest round of rate increases will be rolled out. These NFIP rate increases are required by the Biggert-Waters Flood Insurance Reform Act of 2012 and the Homeowners Flood Insurance Affordability Act, which were meant to prevent the insolvency of the NFIP.
Overall, the NFIP is seeing an average country-wide rate increase of 10.2%, with the average premium increasing from $880 to $969 (when the HFIAA surcharge and Federal Policy Fee are included). However, the premium increase you will see will depend on your flood zone, year of construction, how the property will be used (primary vs. secondary or rental), and elevation difference.
Below are the average NFIP rate increases for all properties:
Pre-FIRM rate increases Special Flood Hazard Areas (SFHAs):
- Primary residences in most A (including AE) and V zones (including VE
- 7.3 – 7.7% average increase
- Non-primary residences (secondary, seasonal, and rental properties) in most A (including AE) and V zones (including VE)
- 23.5% – 24.9% average increase
- Non-residential businesses
- 24.2% – 25% average increases
Post-FIRM rate increases in Special Flood Hazard Areas (SFHAs):
- All occupancies in A1-A30 & AE zones
- 1.4 – 1.7% average increase
- All occupancies in AO, AH, AOB, & AHB zones
- 2.7 – 3.4% average increase
- All occupancies in Unnumbered A zones
- 1.5 – 1.7% average increase
- All occupancies in V, V1-V30, and VE zones
- <1% average increase
Non-Special flood hazard areas including pre- and post-FIRM properties
- 1.3 – 1.4% average increase
Many of our customers live in homes that were built prior to the original flood maps, which are considered pre-FIRM. The primary residence rate increases are similar to those we have seen in years past. However, non-primary, secondary, seasonal, and rental properties are seeing another staggering 23% or more increase in their premiums. These premiums have been increasing exponentially over the past 5 years, and we are seeing more and more times where either the private market or the elevation certificate rate is less expensive. If you own one of these properties, please reach out to our agents so you can discuss your flood insurance options.
If you have any questions regarding the NFIP changes or flood insurance, please reach out to our agent and part-owner, Brian Ford, CPCU, CIC at bford@insuranceresources.com, or 727-345-0242.
