N F I P P o s t F l o o d W e b i n a r f o r A g e n t s N F I P P o s t F l o o d W e b i n a r f o r A g e n t s

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3 Overview 5 TOPICS Overview Flood Insurance and Disaster Assistance The Claims Process Common Coverage Issues Appeals Process Increased Cost of Compliance (ICC) Impact of Biggert Waters 2012 Resources Question & Answer Session 6 3

4 Overview The NFIP Program and Purpose Department of Homeland Security DHS Federal Emergency Management Agency FEMA Mitigation Division National Flood Insurance Program NFIP NFIP Servicing Agent WYO companies 7 Overview Its Not Just An Insurance Program! It is also a Floodplain Management Program. If a Community adopts and enforces minimum building standards the Federal Government makes flood insurance available. 8 4

5 Overview Doctor Slevin s Seven Fundamentals of Flood insurance 1. Every building is in a flood zone. 2. Don t need be in a high-risk flood zone (Special Flood Hazard Area) to purchase flood insurance. 3. Building & contents coverage are purchased separately. 4. A federal disaster declaration is not necessary to file a flood insurance claim. 5. The SFIP is not a guaranteed replacement cost policy. 6. Coverage is limited in basements. 7. Time element exposures are excluded 9 Disaster Assistance 10 5

6 Disaster Assistance Presidential Disaster Declaration Individual Assistance Public Assistance Debris Removal Infrastructure Rebuilding Other Programs 11 Disaster Assistance Sequence Of Delivery For Individual Assistance Register with FEMA 12 6

7 Disaster Assistance Sequence Of Delivery For Individual Assistance Temporary Housing Assistance 13 Disaster Assistance Sequence Of Delivery For Individual Assistance Small Business Administration Loan 14 7

8 Disaster Assistance Sequence Of Delivery For Individual Assistance Small Business Administration Loan 15 Disaster Assistance Sequence Of Delivery For Individual Assistance Individual Assistance Program - $31,

9 Disaster Assistance Sequence Of Delivery For Individual Assistance Group Flood Insurance 17 Disaster Assistance Purchase Flood Insurance SBA Loan Flood Insurance Required Insurable Value Or Maximum Limits 18 9

10 The Claims Process 19 The Claims Process 20 10

11 The Claims Process PROOF OF LOSS EXTENSIONS Date of Loss: October 25, The Claims Process SUPPLEMENTAL CLAIM 22 11

12 The Claims Process ACCELERATED PARTIAL PAYMENT PROCESS 23 The Claims Process 24 12

13 The Claims Process 25 The Claims Process 26 13

14 The Claims Process 27 The Claims Process SCOPING A LOSS 28 14

15 The Claims Process Advance Payments by Conditional Waiver Advance Payment Not To Exceed $5, The Claims Process 30 15

16 Common Coverage Issues 31 Direct physical loss by or from a flood Same policy language is used in all three forms 32 16

17 Common Coverage Issues Definition of Flood NFIP s definition of flood has the following elements: A general condition A temporary condition Partial or complete inundation, such as: Overflow of inland or tidal waters Unusual and rapid accumulation or runoff of surface waters from any source A general and temporary condition of partial or complete inundation of two or more acres of normally dry land area or of two or more properties (at least one of which is your property) from: Overflow of inland or tidal waters Unusual and rapid accumulation or runoff of surface waters from any source. Mudflow 33 Common Coverage Issues Definition of Flood: Erosion Flood-related erosion: Is the collapse or subsidence of land along the shore of a lake or similar body of water Is caused by waves or currents exceeding cyclical levels Results in flooding (as defined in previous slide) Collapse or subsidence of land along the shore of a lake or similar body of water as a result of erosion or undermining caused by waves or currents of water exceeding anticipated cyclical levels that result in a flood

18 Common Coverage Issues Basement Definition Any area of a building, including any sunken room or sunken portion of a room, having its floor below ground level (subgrade) on all sides. 35 Common Coverage Issues Scope of Basement and Post-FIRM Elevated Building Coverage Building Coverage Central Air Conditioners Cisterns and the water in them Unfinished drywall for walls and ceilings Electrical junction and circuit breaker boxes Electrical outlets and switches Elevators and related equipment Fuel tanks and fuel in them Furnaces and water heaters Heat pumps Non-flammable insulation Pumps and tanks used in solar energy storage Sump pumps Stairways and staircases attached to the building Water softeners and the chemicals in them Water filters and faucets, installed as an integral part of the plumbing system Well water tanks and pumps Required utility connections for any item in this list Footings, foundations, posts, pilings, piers, or other foundation walls and anchorage systems required to support the building Clean-up 36 18

19 Common Coverage Issues Scope of Basement Coverage Contents Coverage Air conditioning units: (portable or window type) Clothes washers and dryers Food freezers, other than walk-in, and food in any freezer Note: Must be in functioning location and connected to a power source 37 Common Coverage Issues Garden Apartment 38 19

20 Common Coverage Issues A and V Zone Enclosures Limited coverage for Post- FIRM enclosures in SFHAs Limitations do not apply in Pre-FIRM enclosures 39 Common Coverage Issues Coverage C: Other Coverages Removal of debris, which includes: Non-owned debris in insured property Owned debris from anywhere Value of your labor for removal (at minimum wage) Loss avoidance measures for: Sandbags, supplies, labor (up to $1,000) Property removed to safety (up to $1,000) 40 20

21 Common Coverage Issues Special Limits and Antiques $2,500 limitation Artwork, photographs, collectibles, jewelry, watches furs, etc. Personal Property used in any business (Dwelling Form) Antiques Functional Value 41 Common Coverage Issues Examples of Property Not Covered by NFIP Policies Personal property outside the fully enclosed building Property in, on, or over water Walks, decks & driveways Land, trees, shrubs Fences, seawalls, piers, docks Self-propelled vehicles, recreational vehicles Livestock Crops Accounts, bills, coins, currency, other valuable papers Underground structures, equipment (e.g., septic systems) Storage for gases, liquids Pools and equipment; hot tubs (except as bathroom fixtures) 42 21

22 Common Coverage Issues Exclusions The Standard Flood Insurance Policy does not provide coverage for: Loss of revenue or profits Loss of access or use Loss from interruption of business Additional living expenses 43 Common Coverage Issues Examples of Exclusions Policy does not cover: Sewer backup/seepage Overflow from sump pump Seepage or leaks Pressure or weight of water Other excluded losses: Movement of earth (landslide, earthquake) Gradual erosion Mold or mildew Exception to the above: A flood in the area is the proximate cause of damage

23 Common Coverage Issues Loss Settlement-Replacement Cost Single Family Dwellings & Condos Applies to building coverage only Must be principal residence 80% of building s replacement cost at time of loss or maximum available under the Program. Residential Condominium Building Association Policy (RCBAP) - building only, 80% insured to value 45 Common Coverage Issues Secondary and Vacation Homes Loss Settlement Paid in ACV 46 23

24 Common Coverage Issues Contents Contents is always ACV 47 Appeals Process 48 24

25 Appeals Process The Claims Handbook 49 Appeals Process Letter of Denial received by insured 50 25

26 Appeals Process Step 1 - Talk to the Adjuster Step 2 - Talk to the Adjuster s Supervisor 51 Appeals Process Step 3 - Contact the Carrier s Claims Representative Step 4 - Contact FEMA 52 26

27 Appeals Process Support Documentation May Include: Copy of the Proof of Loss Detailed Damaged Personal Property Inventory Proof that Prior Flood Damage Has Been Repaired Real Estate Appraisals Excluding Land Clear Photographs Confirming Damage Property Re-inspection LC Captain Louis Albano, 1208 Wild Samoan Way, Waynesville VA Desk 1 12 $ % 42 1 Chair 1 1 $ % Table 1 16 $ % 20 1 Bookcase 1 32 $ % 5 1 Bed 1 6 $ % Lamp 1 12 $ % 34 1 Lamp 1 25 $ % 5 1 Computer 1 3 $ % File Cabinet 1 2 $ % 75 1 Bookcase 1 12 $ % 23 1 Printer/Scanner 1 12 $ % 133 *For the complete list of support documentation examples please see the Claims section of the Flood Insurance Manual at 53 Appeals Process FEMA Review FEMA will review the appeal documents and provide specific information on what grounds the claim was initially denied. FEMA will provide an appeal decision within 90 days of submittal to include information for the resolution of the appeal. *Refer insured to the Standard Flood Insurance Policy General Conditions Paragraph R Suit Against Us *Additional Appeal limitations may apply see page CL 2 in the NFIP Flood Insurance Manual 54 27

28 Increased Cost of Compliance (ICC) 55 Increased Cost of Compliance (ICC) What is ICC? 56 28

29 Increased Cost of Compliance (ICC) How much coverage is available? $30, Increased Cost of Compliance (ICC) Four Options Covered Flood-proofing Relocation. Elevation. Demolition

30 Increased Cost of Compliance (ICC) When to file an Increased Cost of Compliance (ICC) claim? Substantial Damage - 50% or more of the building's pre-damage market value. Repetitive Damage 59 Increased Cost of Compliance (ICC) How to File an ICC Claim Filed Separately Community Determines Substantially Damaged or Repetitively Damaged By a Flood Local Official will Explain Consultation is Recommended Contact Agent to File ICC Claim Get Estimates 60 30

31 Increased Cost of Compliance (ICC) How an ICC claim payment is handled Partial Payment Signed Contract Permit ICC Proof of Loss Upon Completion Certificate of Occupancy or a Confirmation Letter Submitted to a Claims Representative Final Installment or Full Payment 61 Increased Cost of Compliance (ICC) Four Years to Complete 62 31

32 Increased Cost of Compliance (ICC) For More Information NFIP Impact of Biggert-Waters

33 Impact of Biggert-Waters Reform Act How has the NFIP Changed? July 6, 2012 law enacted Flood insurance rates to increase Rates will reflect full flood risk Some subsidies and discounts to be phased out and eliminated 65 Impact of Biggert-Waters Reform Act How are premiums changing? Starting January 1, 2013 Non-primary residences Subsidized rates increase 25% per year Until they reach full risk-rate For rating purposes only, FEMA defines a non-principal/non-primary residence as a building that will not be lived in by the insured or the insured s spouse for at least 80% of the 365 days following the policy effective date

34 Impact of Biggert-Waters Reform Act How are premiums changing? Starting January 1, 2013 Non-primary residences Subsidized rates increase 25% per year Until they reach full risk-rate Later in 2013 Subsidized rates increase for: Business properties Substantial damage/improvement Severe repetitive loss Claims exceeding market value More to follow late 2013 & 2014 Newly-purchased properties Properties affected by map changes 67 Impact of Biggert-Waters Reform Act How might flood risk change? New Flood Maps: New Jersey & New York Coastlines Due Mid-2013 Existing FIRMS 25+ Years Old Advisory Base Flood Elevations (ABFEs) 68 34

35 Impact of Biggert-Waters Reform Act Counties where ABFEs will be available: New Jersey: Atlantic Bergen Burlington Cape May Essex Hudson Middlesex Monmouth Ocean Hudson New York: Bronx Kings New York Richmond Queens Westchester For more information on updated flood mapping, visit: 69 Resources 70 35

36 Additional Resources Flood Insurance Manual Online at the Flood Insurance Library: Hard copy from: FEMA Map Service Center P.O. Box 1038 Jessup, MD Additional Resources

37 Additional Resources 73 Additional Resources

38 Additional Resources 75 Additional Resources 76 38

39 Additional Resources 77 Additional Resources 78 39

40 Additional Resources FEMA Distribution Center (240) Additional Resources 80 40

41 Additional Resources 81 Additional Resources

42 Evaluations - Online All attendees will be receiving an with a link to a survey and feedback form. Please take time to complete and help us improve our training effort! THANKS 83 Social Media - Online Follow us on Like us on Facebook at: facebook.com/nfiptraining LIKE. FOLLOW. LEARN 84 42

43 Question & Answer Session