NFIP Discounts
The NFIP offers three categories of premium discounts that have been created to encourage participation, reduce risk, and promote resilience: statutory, mitigation, and CRS.
Statutory Discounts
Find more details on the Statutory Discounts page.
Federal law provides general guidelines about how the NFIP develops rates and does not specify all the details contained in the Flood Insurance Manual. However, a handful of policy premium requirements are given direct mandates by the US Code.
Although the discounts are identified separately throughout the Code, they are classified together in the FIM as Statutory discounts. They exist to encourage a property owner's participation in the NFIP.
Eligible Properties
- Pre-FIRM buildings (constructed before the community's initial Flood Insurance Rate Map).
- Buildings that were Newly Mapped into a Special Flood Hazard Area from a Non-Special Flood Hazard Area.
- Emergency Program properties.
Phasing Out/Glide Path: These discounts gradually reduce through annual caps on premium increases until the policy reaches its full-risk rate.
- A lapse in coverage may result in the loss of eligibility.
- Only the most beneficial statutory discount applies if multiple are available.
Mitigation Discounts
What They Are: Mitigation discounts are incentives for policyholders who implement flood risk-reduction measures, recorded on the application or applied through policy changes.
NFIP Mitigation Actions:
- Elevating machinery and equipment (e.g., furnaces, HVAC systems) above the building's first floor.
- Installing proper flood openings (vents) in enclosures to minimize hydrostatic pressure and reduce damage.
- Floodproofing
Community Rating System (CRS) Discounts
What They Are: CRS Discounts are offered to policyholders in communities that exceed minimum floodplain management standards.
How It Works:
- Communities earn credit points for activities such as public education, flood mapping, and preparedness efforts.
- These points determine the community's CRS class (1–10), with Class 1 providing the highest discount (up to 45%).
Eligibility:
- Applies uniformly across eligible properties within the community.
- Ineligible for properties with significant floodplain violations or non-compliance with community regulations.
These discounts encourage long-term mitigation, compliance, and community participation, making flood insurance more affordable while promoting risk-reduction strategies.
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