Flood Insurance and FAQs

NEW Video: Tom discusses the future of flood insurance, Part 1.

How April 2015 Program Changes Will Affect My Flood Insurance Premiums?

The National Flood Insurance Program (NFIP) is in the process of implementing Congressionally- mandated reforms required by the Homeowner Flood Insurance Affordability Act of 2014 (HFIAA).

Changes taking place in April include:

  1. Rate Increases for most policies
  2. The implementation of an Annual HFIAA Surcharge on all new and renewed policies
  3. An increase in the Federal Policy Fee
  4. An increase in Reserve Fund Assessment.

We want to let you know of these upcoming changes as they will increase the premium of your flood insurance policy at your next policy renewal after April 1, 2015.

All Condominium flood policies (RCBAP) will see a minimum increase of $300, with larger increases depending upon the number of units in an insured building.

For condominiums insured under the Residential Condominium Building Association Policy (RCBAP), the new Federal Policy Fee per policy is:

  • 2-4 units $135
  • 5-10 units $360
  • 11-20 units $720
  • 21 or more units $1,800

All policies:

  • A new HFIAA surcharge of $25 for a primary single family home and $250 for all others
  • Increase in Reserve Fund Assessment from 5% to 15% for most policies
  • An increase in the Federal Policy Fee from $44 to $45 for most policies except condominiums, which are noted above

In addition to the new fee schedule, annual rate changes will also apply. Buildings built prior to 1975 that are still getting subsidized rates will see the largest rate adjustments.

If you have any questions on this or any insurance matter, please contact us at 609-399-0655.

Is there an Official document regarding flood claims that’s issued by FEMA (Federal Emergency Management Agency)?

FEMA Claims Handbook

How much flood insurance coverage is available?

Flood coverage limits for a standard flood policy are:

Coverage Type Coverage Limit
One to four-family structure $250,000
One to four-family home contents $100,000
Other residential structures $250,000
Other residential contents $100,000
Business structure $500,000
Business contents $500,000
Renter contents $100,000


What is Increased Cost of Compliance (ICC) coverage?

If a flood damages your property, you may be required by law to bring your home up to community and/or state floodplain management standards. If you have NFIP (National Flood Insurance Program) insurance, and your home has been declared substantially damaged by your community, ICC coverage is provided to cover up to $30,000 of the cost to elevate, flood proof, demolish, or relocate your property. ICC coverage is in addition to the coverage you receive to repair flood damages; however, the total payout on a policy may not exceed $250,000 for residential buildings and $500,000 for non-residential buildings.


Does flood insurance cover flood damage caused by hurricanes, rivers, or tidal waters?

Yes, providing that, if confined to your property, the flood water covers at least two acres. A general condition of flood also exists if two properties are affected, one of which is yours.


Is flood damage from wind-driven rain covered?

No. When rain enters through a wind-damaged window or door, or comes through a hole in a wall or roof, the NFIP considers the resulting puddles and damage to be windstorm-related, not flood-related.

Flood insurance covers overflow of inland or tidal waters and unusual and rapid accumulation or runoff of surface waters from any source. However, the flood must be 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 yours). Although flood insurance specifically excludes wind and hail damage, the good news is that most homeowners insurance provides such coverage.


What is the Preferred Risk Policy (PRP)?

The Preferred Risk Policy offers multiple coverage combinations for both buildings and contents (or contents-only, for renters) that are located in moderate-to-low risk areas (B, C, and X Zones). Preferred Risk Policies are available for residential or non-residential buildings also located in these zones, and that meet eligibility requirements based on the building’s entire flood loss history.


What is covered in my basement?

Flood insurance covers your home’s foundation elements and equipment that’s necessary to support the structure (for example: furnace, water heaters, circuit breakers, etc.).

It’s important to note that some items in your basement are covered under building coverage (like a furnace, hot water heater and circuit breaker) and others are covered under contents coverage that must be purchased in addition to building coverage (for example, your washer and dryer, or your freezer and the food in it).

The NFIP encourages people to purchase both building and contents coverage. Flood insurance does not cover basement improvements, such as finished walls, floors, ceilings or personal belongings that may be kept in a basement. For a complete list of what’s covered, view the Standard Flood Insurance Policy (SFIP) Forms.


Where can I find the most up-to-date FEMA announcements?

FEMA Bulletins link for the latest information from the Federal Emergency Management Agency

What is your city doing to help reduce your flood insurance?

Avalon, Egg Harbor Township, Linwood, Longport, Margate, Marmora, Northfield, Ocean City, Sea Isle, Somers Point, Stone Harbor,Ventnor, Vineland


What is my ABFE (Advisory Base Flood Elevation)?

Put your address into this interactive map and find our your ABFE.


Have the rules changed since Sandy?

New Jersey’s Emergency Flood Elevation Rule as of 2/12/2013 answers questions such as…

  • What does the flood hazard area emergency rule do?, What are the new elevation standards?
  • What are ABFEs?, Will the ABFEs change?
  • If the ABFEs are only advisory, why is the state incorporating the use of these maps now as the basis for elevation standards?
  • Do I have to elevate my home and/or build to new construction standards?
  • What is the definition of substantial damage?
  • If I have to elevate my house, will the state or federal governments help finance the work?
  • Can I get Increased Cost of Compliance assistance to elevate my home even if it was not determined to be substantially damaged?
  • Will the emergency regulation affect my flood insurance rates?, Are there benefits to elevating?
  • If my home is determined to be substantially damaged, can I still live in it until I elevate?
  • Am I eligible for Increased Cost of Compliance funding if I take up to four years to elevate my house?
  • Do I have to elevate my house and/or build to new construction standards if my municipality does not pass an ordinance adopting the ABFEs?
  • If I have to rebuild, when should I get started and what should I do?
  • What should I know before rebuilding?
  • What’s the difference between FEMA’s Zone A and Zone V? Can I appeal a V‐Zone designation?


More Useful Links:

Read about the Biggert-Waters Act (Flood Insurance Reform Act of 2012) at fema.gov.  The Act calls on the Federal Emergency Management Agency (FEMA), and other agencies, to make a number of changes to the way the National Flood Insurance Program (NFIP) is run. Some of these changes already have occurred, and others will be implemented in the coming months. Key provisions of the legislation will require the NFIP to raise rates to reflect true flood risk, make the program more financially stable, and change how Flood Insurance Rate Map (FIRM) updates impact policyholders. The changes will mean premium rate increases for some—but not all—policyholders over time. Homeowners and business owners are encouraged to learn their flood risk and talk to their insurance agent to determine if their policy will be affected by BW-12.

State of NJ information for Flood Recovery