WHAT IS THE NFIP FLOOD INSURANCE PROGRAM (NFIP)?
The National Flood Insurance Program (NFIP) exclusively covers all flood-related damage that is not covered under Commercial Property Policies and Homeowner Insurance Policies. NFIP flood insurance was created in the 1980s by the federal government after private insurance carriers determined that, due to the frequency of flood related damages, it was too costly to insure properties in flood-prone zones. The program was set-up wherein the private insurance carrier acts as the Third Party Administrator, TPA, for NFIP. The carriers market the NFIP commercial and residential policies, collect the premiums, handle the claim investigation, document the file per NFIP policy guidelines, and submit a recommendation for coverage and payment to FEMA. However, the final determination of coverage and payment is retained by FEMA.
WHAT IS THE SMALL BUSINESS ADMINISTRATION DISASTER LOAN PROGRAM?
The Small Business Administration Disaster Loan Program is one of several benefits and programs available to insureds after a flood. While the NFIP flood insurance claim process is being completed, SBA Emergency Bridge Loans, as well as other programs such as Mitigation Grants, may be negotiated to assist with repairs, costs, and other expenses resulting from the flood. An experienced and knowledgeable NFIP Claims Specialist can help an insured receive the assistance necessary to fully recover from a devastating flood.
WHAT HAPPENS IF THERE IS FOUNDATION DAMAGE?
The majority of NFIP flood insurance claims involve substantial damage to the building’s foundation. Under standard commercial and residential policies, foundation damage is excluded. Therefore, when presenting a flood claim with foundation damage to FEMA, it is imperative to have a public adjuster who understands construction and also has a network of professional engineers with the experience to effectively counter any reports prepared by the NFIP adjuster or FEMA engineer. If foundation damages are not properly documented and handled, the claim may be significantly underpaid which can mean the difference between being able to properly repair damaged property or not.
WHAT IF A SUPPLEMENTAL PAYMENT FOR ADDITIONAL COSTS NEEDS TO BE MADE?
Under NFIP, a formal appeal to FEMA is required in order to make a claim for supplemental payment for damages. During this process, the FEMA adjuster reviews the original policy coverage and coordinates with their engineers to determine causation of damages, the scope of repairs, and loss value of the additional claimed amount. Although it is difficult to ascertain all the damages that may result after a flood, a public adjuster experienced in handling NFIP claims can successfully navigate the appeal process so that the additional damages and/or loss value being claimed are properly addressed by FEMA.
WHAT IF FEMA IS REFUSING TO PAY FOR DAMAGES UNDER THE NFIP FLOOD INSURANCE PROGRAM?
NFIP flood insurance Claims are governed by an entirely different set of rules, regulations, and guidelines than Commercial and Residential Policies, which are provided by private insurance carriers. Thus, it is imperative to have an NFIP Claims Specialist that fully understands the investigation process involved in proving flood damages; is able to properly interpret and analyze coverage issues; and has the contacts at the local, state, and federal level to successfully resolve an NFIP residential or commercial claim.