FEMA Releases Latest Edition of the National Flood Insurance Program Manual
The updated edition of the National Flood Insurance Program’s Flood Insurance Manual is now available. The October 2022 edition of the Flood Insurance Manual incorporates changes provided earlier to NFIP insurers through monthly Underwriting Guidance Updates between November 2021 and June 2022 and reflects the NFIP’s existing underwriting requirements and its current rating methodology, Risk Rating 2.0.
Highlights include:
- Provided guidance for standardization of street addresses.
- Updated guidance to reflect a recent program change to use the flood zone at the time of loss to determine elevated building coverage limitations.
- Expanded the language about exclusions and limitations for Basement and Elevated Building with Enclosure.
- Updated Construction Type to include Two-to-Four Family Building in building occupancy.
- Clarified that the masonry construction type is based on the first full floor above a basement, walkout level or a crawlspace.
- Clarified guidance on the building square footage calculation.
- Updated guidance to allow NFIP insurers to obtain the Building Replacement Cost Value using common industry practices they currently use or based on information that they already may have.
- Added language to explain the application of a loss constant and an expense constant to each policy premium and clarified the potential impact of minimum and maximum rates on the premium.
- Clarified that any coverage increase is exempt from the Annual Increase Cap.
- Updated guidance for cancellation of a policy when the policyholder is deceased.
- Updated the guidance and processes for the SRL properties.
- Clarified that FEMA requires the Primary NAIC number to be used on the policy declarations page.
- Updated the definitions to include loss constant and expense constant.
