Suspension
NFIP Policy Index
Definition/Description:
The National Flood Insurance Act of 1968 porohibits FEMA from providing flood insurance in a community unless the community adopts and enforces floodplain management regulations that meet or exceed minimum NFIP criteria. A community can be suspended from the NFIP for failure to adopt compliant floodplain management measures or if it repeals or amends previously compliant floodplain management measures. A community can also be suspended from the NFIP for failure to enforce its floodplain management regulations.
New flood insurance coverage cannot be purchased and policies cannot be renewed in a suspended community. In addition, three-year policies become void at the end of the current policy year with a pro rata refund given for any remaining years of the original three-year policy term.
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NFIP Requirement:
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Guidance:
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Supplemental Information for Suspension
A community that does not join the NFIP, has withdrawn from the program, or is suspended from it, faces the following sanctions:
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No resident will be able to purchase a flood insurance policy.
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Existing flood insurance policies will not be renewed.
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No Federal grants or loans for development may be made in identified flood hazard areas under programs administered by Federal agencies such as HUD, EPA, and SBA;
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No Federal disaster assistance may be provided to repair insurable buildings located in identified flood hazard areas for damage caused by a flood.
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No Federal mortgage insurance or loan guarantees may be provided in identified flood hazard areas. This includes policies written by FHA, VA, and others.
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Federally insured or regulated lending institutions, such as banks and credit unions, must notify applicants seeking loans for insurable buildings in flood hazard areas that there is a flood hazard and that the property is not eligible for Federal disaster relief.
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Last Modified: Tuesday, 17-Apr-2007 11:11:28 EDT