Many property owners are finding that the draft flood maps released by FEMA last month have moved them into a higher risk flood zone. In Key West alone, over 2,000 properties may be moved from the X zone where flood insurance is not required by lenders into a Special Flood Hazard Area (SFHA) where insurance will be required.

For these property owners, FEMA offers the Grandfathering option. What Is the Grandfathering Rule? When flood map changes occur, the National Flood Insurance Program (NFIP) provides a lower-cost flood insurance rating option known as “grandfathering.” It is available for property owners who:

  • Already have flood insurance policies in effect when the new flood maps become effective and then maintain continuous coverage; or
  • Have built in compliance with the FIRM in effect at the time of construction.

While grandfathering typically will provide cost savings to a property owner when the new FIRM takes effect, there may be cases when using the rating based on elevation will result in lower premiums. So both options should always be evaluated.

Read the full fact sheet on FEMA’s website, and consult with your insurance agent to determine what is best for you.

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