National Flood Insurance Program
San Mateo County has participated in the National Flood Insurance Program (NFIP) since 1975. The County also participates in the Community Rating System and is currently Class 9. The County was recently audited by FEMA, who conducted a Community Assisted Visit (CAV) on July 10, 2009. The results of this CAV put the County in good standing with FEMA and enabled the County to join FEMA’s Community Rating System Program at Class 9. Flood insurance premium rates in Community Rating System communities are discounted; a Class 9 community receives a 5% discount for policies within and outside of Special Flood Hazard Areas.
The NFIP that makes available federally backed flood insurance for all structures, whether or not they are located within the floodplain. More than 25% of NFIP claims are filed by properties located outside the 100-year floodplain, also known as the Special Flood Hazard Area (SFHA). Following the purchase of flood insurance, NFIP imposes a 30-day waiting period, so residents should purchase insurance before the onset of the rainy season to ensure coverage during the flooding season. Please be aware that standard homeowner or renter insurance policies do not cover losses due to flooding.
Membership within NFIP, and the availability to County residents of flood insurance, requires the County to manage its floodplain in ways that meet or exceed standards set by FEMA. NFIP insures building with two types of coverage: structural and contents. Structural coverage includes walls, floors, insulation, furnace and other items permanently attached to the structure. Contents coverage may be purchased separately to cover the contents of an insurable building. Flood insurance also pays a portion of the costs of actions taken to prevent flood damage.
Since July 1, 1997, all NFIP policies include Increased Cost of Compliance coverage that assists with bringing structures into compliance with current building standards, such as elevating structures 1-foot or more above the height of the 100-year flood. The limit of this coverage is $30,000.
Federal financial assistance requires the purchase of flood insurance for buildings located within the SFHA, a requirement that affects nearly all mortgages financed through commercial lending institutions. This mandatory requirement stipulates that structural coverage be purchased equal to the amount of the loan, or other financial assistance, or for the maximum amount available, which is currently $250,000 for a single family residence. While the mandatory flood insurance purchase requirement has been in effect for many years, not all lending institutions required flood insurance in the past. Today, however, most institutions are now requiring the flood insurance purchase, and some are reviewing all mortgage loans to determine whether flood insurance is required and should have been required in the past. Upon refinancing a loan, nearly all lending institutions will enforce the flood insurance requirement. It is the lender’s responsibility to check the Flood Insurance Rate Map (FIRM) to determine whether a structure is within the SFHA.
The mandatory flood insurance purchase requirement does not apply to loans or financial assistance for items that are not eligible for flood insurance coverage, such as vehicles, business expenses, landscaping and vacant lots. The requirement also does not apply to loans for structures not located in a SFHA, even though a portion of the lot may be within a SFHA. Persons located within SFHAs who received disaster assistance after September 23, 1994 for flood losses to real or personal property must purchase and maintain flood insurance coverage, otherwise future disaster assistance will be denied.