Understanding the Newly Mapped Procedure
A client’s property’s flood risk is changing from a moderate- to low-risk flood area (Zone B, C, or X) or Unknown (Zone D) to a high-risk area (Zone A or V).
What this means for existing or potential clients
For clients that are newly identified to be a high-risk flood area, the NFIP offers a cost-saving option called the Newly Mapped Procedure.
With Risk Rating 2.0: Equity in Action, Newly Mapped discounts and subsequent rate increases will continue. Premiums will continue increasing gradually and within the existing statutory limits set by Congress until reaching the full risk premium. Rates will go up no more than 18% each year until they reach their full risk premium.
If the building is sold, the policy can be transferred to the new owners, allowing them to keep the lower-cost rate. Clients must maintain coverage continuously to keep their Newly Mapped rate.
Risk Rating 2.0: Equity in Action
With Risk Rating 2.0: Equity in Action, FEMA now has the capability and tools to address rating disparities by incorporating more flood risk variables like flood frequency, multiple flood types — river overflow, storm surge, coastal erosion, and heavy rainfall — and distance to a water source, as well as property characteristics such as elevation and the cost to rebuild.
This means that although flood mapping data will still be necessary and essential for communities, and Flood Insurance Rate Maps (FIRMs) will continue to be used for mandatory purchase requirements, building code requirements, and floodplain management requirements, flood maps will no longer be the most significant factor in rating premiums.