Property owners along the nation's coastline surely know of the National Flood Insurance Program, a federal program that provides flood insurance protection in return for encouraging better construction standards along the coast.
Changes enacted by Congress last summer will affect their coverage and cost of the program as higher standards and premiums are now being felt.
Structures built before the NFIP was established in the early 1970s are dubbed "pre-Flood Insurance Rate Map buildings."
To encourage community participation and structural and siting improvements, the NFIP offered subsidies to pre-FIRM structures. With reform, those subsidies are being deleted for second homes, rental homes, business structures and structures that have suffered severe and repeated flood losses.
For other pre-FIRM structures, the subsidies are decreasing based on how much the structure is below the current base-flood elevation for its location (san estimate of how much higher a structure should be elevated to avoid routine flooding).
Based on decades of data, flood maps set the base flood elevation for a coastal area, which in turn helps to set the NFIP premium a property in that zone can expect to pay now and in the future.
New data means new maps and coastal owners may see changes in flood zones and premiums as new maps are implemented,
New maps already under way before Superstorm Sandy struck will dramatically reshape the coastal construction standards in the New York-New Jersey area, with the number of structures in flood zones expected to double. Also, new maps affecting old structures used to allow those structures to be grandfathered at the old BFE for premium purposes. That is no longer the case, which means that if your zone changes to raise the required BFE, your structure will be charged accordingly based on its difference from the required BFE, which will means a higher premium over time.
The NFIP used to be limited to no more than a 10 percent rate increase by law. The reform bill doubled that limit to 20 percent, which means premium adjustments will kick in more quickly than before (five years instead of 10). Properties that lost subsidized coverage could see premiums rise even faster to bring them in line with actual premium levels.
NFIP reform is probably not over, with calls for even more stringent measures being countered by others who want to let the current round of changes (barely six months old by now) take effect before modifying the program more.
However, given the scope of losses the program has faced first from Katrina and, now, as the bills from Sandy mount the push to make NFIP more self-supporting (or at least less expensive for the federal government) is certain to continue.
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The American Shore & Beach Preservation Association advocates healthy coastlines by promoting the integration of science, policies and actions that maintain, protect and enhance the coasts of America.