NFIP Claims

The National Flood Insurance Program claims process is designed to support policyholders recovering from flood damage by offering standardized procedures and assistance. This article outlines the key aspects of NFIP policy claims, including filing processes, disputes, appeals, and special provisions like Increased Cost of Compliance (ICC).

Filing an NFIP Claim

Prompt Notification

• Policyholders must notify their insurer in writing immediately after a flood loss.
• This is called First Notice of Loss (FNOL).
• Insurers assign an adjuster, typically within 24-48 hours, though this may vary based on flood severity.

Damage Inspection and Estimate

• The adjuster inspects the property to assess damage and prepare an estimate of insured losses.
• The policyholder receives a copy of the estimate and must submit a signed Proof of Loss (POL) form within 60 calendar days of the flood loss.
• Additional POLs can be submitted if more damage is identified, provided they adhere to the same 60-day timeline.

Claims Payment Process

• Payments are made based on the coverage limits and deductibles stated in the policy.
• Insurers reform policies if underwriting errors are discovered during the claims process, ensuring accurate coverage.

Disputing an NFIP Claim

If a policyholder disagrees with the adjuster’s damage assessment or claim amount, they can:

• Work with the Adjuster: Discuss discrepancies and submit supporting documentation.
• Contact the Adjusting Firm: Escalate concerns to the adjuster’s supervisor.
• Consult the Insurer: Engage the insurer's claims department to resolve disputes.
• File a POL: Submit a revised POL form with additional evidence. If the insurer denies any portion of the claim, a written denial is provided.

Appealing a Claim Decision

Policyholders may appeal denied or partially denied claims to FEMA.

Appeal Requirements

An appeal must be submitted within 60 calendar days of the insurer’s denial letter and include:

• Policyholder information (name, address, policy number).
• A summary of disputed issues with supporting documents.
• A copy of the denial letter.

Appeal Submission

Appeals can be sent via mail or email:

• Mail: Federal Insurance and Mitigation Administration Federal Insurance Administrator 400 C Street SW Washington, DC 20472-3010
• Email: FEMA-NFIP-Appeals@fema.dhs.gov

Legal Action

If disputes remain unresolved, policyholders may file a lawsuit in the United States District Court where the property is located. Legal action must be initiated within one year of the insurer's first written denial.

Increased Cost of Compliance (ICC) Claims

ICC coverage helps policyholders mitigate future flood risks by contributing to the costs of compliance with local floodplain management requirements.

Eligibility for ICC Claims

• Applies to buildings declared substantially damaged by a flood, meaning repair costs exceed 50% of the building’s market value.
• Policyholders must provide the insurer with the community’s substantial damage determination.

Mitigation Projects

Eligible projects include elevation, relocation, demolition, and floodproofing.

• Projects must be completed within six years of the flood claim.
• Pre-approval from the insurer is required to maintain eligibility.

Claims payment delays

Claims adjusters are required to validate the mortgagee information at the time of the loss.  A few common issues cause most of the delays.

If the mortgagee has changed between the time the policy was issued and the date of the loss, the mortgagee information must be updated before the claim can be paid.  Validating and updating the information at the time of loss frequently causes delays in payment.

Agents/Insureds can help avoid these delays by advising the company prior to the loss that the mortgagee has changed.  Agents are allowed to update mortgage information on the Equinox Platform.  As soon as the agent submits the new information, the system will update the Policy Record and issue a new Declarations Page. Insureds can also update mortgagee information using their Consumer Portal.  When the insured submits the change, Equinox will automatically update the mortgage information on the Policy Record and issue a new Declarations Page.

Incorrect foundation information on the policy causes delays during the claim process.  It is very important that the correct foundation information is used during the application/change process.  The foundation type is a rating element so an error may cause a difference in premium.   If at the time of the loss an error is found, the policy must be reformed to use the correct foundation type. Additional premiums may required to retain the amount of coverage on the policy.  This same process applies to all errors discovered at the time of loss and may result in a reduction of coverage and a lower claim payment if not handled correctly.

This page contains information about the NFIP. Find more NFIP Resources.