At its simplest, grandfathering says you can keep the insurance you currently have under certain conditions. Grandfathering is a National Flood Insurance Program (NFIP) rule that was created to recognize property owners who carried a policy before the maps became effective or built to the correct standards relative to the flood map in effect at the time of construction.

(FIRM is shorthand for Flood Insurance Rate Map.)

First, you need to understand these terms: pre-FIRM and post-FIRM

Pre-FIRM (permitted before 1-1-1975) A pre-FIRM building is one that was constructed prior to the date of the community’s first FIRM. In most cases, owners of pre-FIRM buildings have just one opportunity to use the grandfathering rule: for the purchase an insurance policy before the updated FIRM (the new rate maps) becomes effective.

The exception is a pre-FIRM building that is newly mapped into a high-risk area. If it qualifies for a preferred risk policy (PRP), the property owner has up to two years from the new map’s effective date to purchase a PRP tthat will grandfather in the lower risk zone for future rating. In either instance, to maintain the grandfathered zone, the policy must stay continuously in effect. Continuity of coverage can be maintained even if the building is sold, as the policy can be assigned to the new owner.

A Post-FIRM building was built after the adoption of the community’s first flood insurance rate map, and after the floodplain was defined, and after the community adopted its floodplain ordinances. Those buildings have to play by a different set of rules. Especially when they are built in special flood hazard areas. Limitations and restrictions apply to Post–FIRM Elevated buildings in Special Flood Hazard Areas.

Post-FIRM buildings have two chances to lock in the BFE and/or flood zone: before the maps become effective or after the effective date, but with the proper documentation. Continuous coverage is not required. If, however, a building is substantially damaged or improved or if it was not built in compliance, grandfathering of previous zones or BFEs can no longer be applied.

Many property owners are finding that the draft flood maps released by FEMA in August 2019 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 certain property owners, FEMA offers the Grandfathering option. 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 Federal Insurance Rate Maps (FIRM) take effect, there may be cases when using the rating based on elevation will result in lower premiums. Both options should always be evaluated.

Do not confuse Pre-FIRM and Post-FIRM with Fair Insurance Rates in Monroe (FIRM). This video is a helpful explainer of the difference:

Contact your insurance agent: The rules and regulations that apply to federal flood insurance are complicated and your flood insurance specialist is best positioned to ensure you are appropriately covered.

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