how to use this presentation flood insurance is a critical part of any mitigation plan. a better...

How to Use This PresentationFlood insurance is a critical part of any mitigation plan. A better insured community is a resilient one. Use this presentation to educate business owners on flood risk and the importance of having flood insurance.  This presentation is virtually ready to use immediately:• Customize or delete information on slides 2, 17, and 24 based

on your specific needs. • Consider using slide 25 if your audience needs to know about

legislation changes. The latest legislation information is at FEMA.gov/flood-insurance-reform. Once you update those slides and delete this instructional slide, you are ready to present.

 Questions or Comments?Please contact info@femafloodsmart.com.

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Flood Insurance and Your Business

[ORGANIZATION NAME][YOUR NAME]

[DATE]

[Organization Logo]

National Flood Insurance Program

Flood Misconceptions and Facts

Commercial Flood Insurance Basics

Reducing the Risk

Resources for You

Presentation Overview

National Flood Insurance Program

Created by Congress in 1968.

Provides flood insurance to homeowners, renters, and business owners.

Community must participate in the program.

Written by insurance agencies through their carrier or direct with the NFIP (rates and coverage are the same for all agents).

Administered by the Federal Emergency Management Agency (FEMA).

National Flood Insurance Program (NFIP)

According to the Insurance Institute for Business and Home Safety, 1 in 4 businesses that close after a disaster-related event like floods never reopen.

Why Flood Insurance?

What Is a Flood?

A Flood Defined

Inundation of 2 or more acres of normally dry land or of two or more properties (one of which is your property) from: Overflow of inland or tidal waters;

Unusual, rapid accumulation or runoff of surface waters from any source;

Mudflow; or

Collapse or sinking 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 levels that result in a flood.

Flood Misconceptions and Facts

Misconception: Risk

Misconception: “I am not in a flood zone.”

Facts: Floods are the #1

natural disaster in the United States.

If it can rain, it can flood.

Risk does not stop at a line on a flood map.

Misconception: Commercial Coverage

Misconception: “I’m already covered—my commercial policy covers flooding.”

Fact: Many insurance policies do not cover flooding; only flood insurance covers flood damage.

Misconception: Disaster Assistance

Misconception: “If a flood happens, disaster assistance will cover me.”

Facts: Only available if the

President declares a Federal disaster.

You must qualify.

Typically given in the form of a loan that must be repaid, with interest.

Commercial Flood Insurance Basics

Single-peril policy.

Pays up to the Actual Cash Value (depreciated value) of the actual damages or the policy limit of liability, whichever is less.

Contents coverage is not automatically included in your policy (with the exception of a Preferred Risk Policy). Only pays Actual Cash Value. Can be applied to personal property or commercial contents, but

not both.

Three Basic Facts of a Flood Policy

Key Rating Elements: Flood Zone

High-Risk Zones Special Flood Hazard Areas

(SFHAs); labeled “A” or “V”.

Moderate- to Low-Risk Zones Non-Special Flood Hazard

Areas (NSFHA); labeled B, C, or X.

Base Flood Elevation (BFE) The estimated depth of floodwater during a 1 percent

annual chance flood.

Lowest Floor Elevation (LFE) Post-FIRM Buildings For zones beginning with “A”: elevation of the top of the

lowest floor.

For zones beginning with “V”: if elevated, bottom of the lowest horizontal structural member.

Rates Based on LFE - BFE.

Key Rating Elements: Elevation for High-Risk Zones

Coverage Limits $500,000 on building $500,000 on contents

Deductibles

Community Rating System (CRS)

Key Rating Elements: Coverage and Deductibles

Provides up to $30,000 for buildings in high-risk areas.

Building must be declared substantially damaged or a repetitive loss.

Used to floodproof, elevate, relocate, or demolish.

Total amount of your business claim and ICC claim cannot exceed $500,000.

Increased Cost of Compliance Coverage

Typically, there is a 30-day waiting period for a flood insurance policy to go into effect.

Exceptions Flood insurance is required by a federally regulated and

insured lender—0 days.

Wildfire 30-day waiting period exception—0 days.

Initial purchase of flood insurance as the result of a map revision—1 day.

Waiting Periods

Policy for businesses in moderate- to low-risk areas: Lower-cost policy.

Policy includes both building and contents.

Contents-only coverage is available for lessees.

Preferred Risk Policy (PRP)

Business Recovery Plan

Elevate Building Machinery Contents

Stronger CRS Participation by the Community

Reduce the Risk, Reduce the Cost

FloodSmart.gov: Learn Your Risk

FEMA.gov

Ready.gov

DisasterSafety.org

SBA.gov

Additional Resources

[YOUR NAME][ORGANIZATION NAME][ORGANIZATION ADDRESS][AGENT PHONE NUMBER][AGENT EMAIL]

Questions

Subsidies for older (pre-FIRM) buildings in high-risk areas being phased out.

Rates for pre-FIRM business buildings set to increase each year until reaching full-risk rates

Elevating or floodproofing might help lower your rates 

For more information, visit FEMA.gov/flood-insurance-reform.

Recent Legislation