Posted October 10, 2018 07:33:49The National Flood Risk Reduction Program (NFRIP) is one of the most successful programs in the nation’s flood insurance industry.
Since its inception in 2006, NFRIP has contributed more than $1.4 trillion to flood insurance companies and insurance companies’ liability coverage for tens of millions of Americans.
But as of 2020, the NFRIp’s flood coverage was just $1 billion short of the federal government’s total flood insurance coverage, which was $7.9 trillion.
That shortfall, combined with a federal insurance mandate that mandates insurers cover the cost of flood damage, is one reason why more than 3.2 million Americans remain uninsured, according to a report released by the U.S. Department of Health and Human Services.
The NFRIpece is the umbrella program for insurance policies in the NFIP, covering insurance companies that are federally regulated and are subject to the NFIRP.
NFRIPece coverage is only available for those covered by NFIP policies that are directly insured by a NFRI, so that NFRI policies are not required to pay the cost.
However, when an NFRI policy does not meet the requirements of NFRI pece, the insurer is required to compensate the policyholders for the difference between the NFISP and NFRI coverage.
Under NFRI insurance, the policyholder has the option of paying the difference or paying out of pocket.
While NFRI covers the cost for all NFRI insured policies, the difference is limited to the coverage portion of the policy.
In order to cover the NFIB or NFRI premium, insurers must pay for the flood risk reduction portion of their policies.
In 2018, NFIB premiums were $1,895 per year.
In 2019, the premium was $1 — but, due to the rising flood risk in 2018, it’s still less than the NFIFP’s flood coverages.
When you purchase NFRI flood insurance, your policyholder pays a fixed amount of cash based on their deductible, the cost per incident of flood, and the total flood damage from the year prior.
For instance, if you purchased a policy in 2018 and lost $100,000, you’d pay a total of $250 per incident for flood insurance in 2019, or $3,800 per year for 10 years.
That’s a huge savings!
However, the actual cost of premiums is not included in the coverage of your NFRI.
For example, if a flood occurs and you are covered for a total loss of $100 per incident in 2019 and $100 in 2018 for flood protection, but your NFIRPP coverage is not yet fully funded, you will pay a deductible of $3 for each incident of a $100 flood.
For those who are not insured by NFRI or the NFI, NFIP policyholders can purchase flood insurance through their employer.
The same applies to the government’s National Flood Compensation Program (NFCP), which is the same type of policy that NFIRPs are covered under.
In addition, if an NFIRPece policy is purchased for an individual with a policy from a company that does not fall under NFRI and NFIP coverage, the employee must pay the NFIA (for example, the National Insurance Crime Bureau).
The federal flood insurance program, however, is not the only program available to NFIP customers.
Some insurance companies offer flood insurance for those who may be uninsured, such as farmers who purchase flood coverage through the NFIC (non-insured farmers), who may not have insurance from the NFPI or NFIP.
However the NFIO has limited coverage to this group of individuals.
For a list of NFIP and NFIFPI policies, check out our article, The National Flood Relief Program, and NFIR pece coverage.