FEMA To Change Flood Insurance Pricing

The Federal Emergency Management Agency (FEMA) is changing its National Flood Insurance Program (NFIP) pricing methodology beginning Oct. 1.

The new pricing scheme, which FEMA calls a ‘transformational leap forward,’ will incorporate more flood insurance variables, tying premiums directly to actual flood risk.

Since the 1970s, pricing for the NFIP premiums has been based largely on a property’s elevation within a zone on a flood insurance rate map.

According to FEMA, this meant owners of higher value homes were ‘paying less than their share of the risk.’