The new information provides localized rate analysis at the zip code level for all 50 states and the District of Columbia, as well as flood mitigation actions for policyholders.
Over the last several days, FEMA released new and important information about Risk Rating 2.0. Risk Rating 2.0— FEMA's new pricing methodology for the National Flood Insurance Program (NFIP)—is currently scheduled to be implemented starting on Oct. 1 for new policies and for those seeking to renew polices that will see lower rates under the new methodology. Risk Rating 2.0 will be implemented for all other renewals starting in April 2022.
Late last week, FEMA announced that the Risk Rating 2.0 webpage has been updated and now includes zip code-level data about Risk Rating 2.0 changes. The new information provides localized Risk Rating 2.0 rate analysis at the zip code level for all 50 states and the District of Columbia, as well as mitigation actions a policyholder can take to lower their risk of flooding and, possibly, their premium. In their announcement, FEMA noted that these are estimates of counts, not precise counts.
In an additional announcement, FEMA released the final draft guidance for Risk Rating 2.0. This release started with the issuance of WYO Bulletin w-21007 on floodsmart.gov. FEMA also established a new NFIP services page for Risk Rating 2.0. The webpage houses the draft Risk Rating 2.0 Industry Transition Memo and a draft Risk Rating 2.0 Flood Insurance Manual.
The guidance details the upcoming Risk Rating 2.0 program changes that will apply to all Risk Rating 2.0 policies. In the release of these materials, FEMA noted they were providing these documents to industry partners in advance of their finalization to assist the industry in their implementation efforts.
Furthermore, FEMA said that their intent in posting these documents publicly in final draft format is to allow for the broadest distribution for the companies and their agent workforce who partner with FEMA in support of the NFIP. The final guidance documents will be available in September 2021, prior to their effective dates on Oct. 1.
As Risk Rating 2.0 implementation approaches and FEMA delivers more information, the Big “I" will continue to provide updates through the weekly News & Views e-newsletter.
Wyatt Stewart is Big “I" assistant vice president of federal government affairs.