Reduced Flood Risk = Lower Insurance Costs
Release Date: November 4, 2004
Release Number: 1539-250
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ORLANDO, Fla. -- For flood insurance policyholders looking for a way to lower their costs, there is one surefire way to lower premiums and realize significant cost savings.
Just ask the 1,833,936 Florida policyholders whose premiums were reduced by a whopping $180 million dollars last year. That translates, from the 216 communities that are members in Florida, to an average savings of around $98.
It's all because of a federal program designed to encourage communities to reduce flood risk. Known as the Community Rating System (CRS), it is part of a National Flood Insurance Program (NFIP) initiative to reward communities that undertake measures to lessen or eliminate flood exposure. The NFIP is administered by the Federal Emergency Management Agency (FEMA).
Any NFIP participating community can elect to take part in the program. Under the CRS, communities are rated on a scale of 1-10, depending on the extra measures taken by the community to provide protection from flooding.
Local officials can improve a community's rating by agreeing to undertake certain activities designed to reduce flood losses. The community is then assigned points, based on the number and type of activities completed. The better the flood risk management, the lower the rating score, and the lower the insurance premiums.
"The CRS program can bring considerable benefits to the residents of participating communities," said Bill Carwile, federal coordinating officer for the Federal Emergency Agency (FEMA). "Not only can they look forward to a greatly reduced risk of flooding in the years ahead, they will also pay less to insure against that threat."
The menu of flood reduction activities communities may decide to tackle can include such things as initiating flood warning programs, upgrading drainage system maintenance, developing a citizen outreach strategy, requiring open space preservation and legislating tougher regulatory standards. In addition to lower flood insurance premiums, CRS participation brings a wealth of other benefits to the community. They include:
- Enhanced public safety;
- Reduced damage to property and public infrastructure;
- A better-protected environment;
- Technical assistance in developing and implementing the chosen activities;
- The ability to evaluate a community program against a nationally recognized benchmark;
- An incentive to maintain strong flood control ordinances that make favorable ratings possible.
Almost 3 million policyholders in 1001 communities around the country now benefit from the CRS. In Florida, where 1.8 million flood insurance policies are in force, 216 communities are members.
To see if your community is a member, go to the CRS community list at www.fema.gov/nfip. The list shows member communities, their rating, and the percentage of discount available on flood insurance, if any. Information on the CRS program as well as general information about flood insurance is available on the www.FloodSmart.gov website as well.
Flood insurance is available to residents of any NFIP-participating community. For information, property owners should contact their insurance agent or call the NFIP at 1-800-427-4661
On March 1, 2003, FEMA became part of the U.S. Department of Homeland Security. FEMA's continuing mission within the new department is to lead the effort to prepare the nation for all hazards and effectively manage federal response and recovery efforts following any national incident. FEMA also initiates proactive mitigation activities, trains first responders, and manages the National Flood Insurance Program and the U.S. Fire Administration.
Last Modified: Thursday, 04-Nov-2004 14:59:45