National Flood Insurance Program – [Town/City] FEMA Updates Flood Insurance Rating Methodology.

For Immediate Release 

[Municipal Contact Person]
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[Town/City], NEW HAMPSHIRE – The Federal Emergency Management Agency (FEMA) has updated the National Flood Insurance Program’s risk rating methodology though the implementation of a new pricing methodology called Risk Rating 2.0. This new methodology will communicate flood risk more clearly, so policyholders can make more informed decisions on the purchase of adequate insurance and on mitigation actions to protect against the perils of flooding. 

With Risk Rating 2.0, FEMA now has the capability and tools to address rating disparities by incorporating more flood risk variables. These include flood frequency, multiple flood types—river overflow, storm surge, coastal erosion and heavy rainfall—and distance to a water source along with property characteristics such as elevation and the cost to rebuild.

Currently, policyholders with lower-valued homes are paying more than their share of the risk while policyholders with higher-valued homes are paying less than their share of the risk. Because Risk Rating 2.0 considers rebuilding costs, FEMA can equitably distribute premiums across all policyholders based on home value and a property’s unique flood risk.

In New Hampshire, of approximately 7,700 NFIP policies in force, FEMA anticipates that the introduction of Risk Rating 2.0 will result in decreased premium costs for 35% of policyholders, slight increases for 58%, and increases of $20 per month or more for the remaining 7%. You can view the NH State Profile Fact Sheet for more details. 

Risk Rating 2.0 went into effect for all new policies beginning October 1st, 2021 and is now available for all existing policyholders eligible for renewal. All remaining policies renewing on or after April 1, 2022 will be subject to the new rating methodology. 

Learn more about Risk Rating 2.0 at https://www.fema.gov/flood-insurance/risk-rating. 

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