A community-based flood insurance option
This report examines a community-based flood insurance (CBFI) option - that is a single insurance policy for an entire community - under the U.S. National Flood Insurance Program (NFIP) as one of the components in the nation's approach to managing flood risk. The NFIP is overseen by the Federal Emergency Management Agency (FEMA), which was asked to evaluate the prospects for CBFI. To satisfy this request, FEMA asked the National Research Council (NRC) to convene an expert committee on a CBFI option.
The report identifies a range of key issues and questions about a CBFI option that merit further analysis and consideration. It notes that the prospects for community-based flood insurance may be compromised if communities are unwilling to participate, have limited administrative capabilities to implement a program, or lack authority to regulate land use and collect revenue. The report also notes that more explicit definitions will be needed if community-based flood insurance is implemented, and that any future community-based flood insurance program must also consider who bears the risk; who writes the policy and determines coverage limits and standards; how premium costs are underwritten, priced, and allocated; who accepts the administrative capabilities; how compliance with any mandatory purchase requirements is ensured; and how pricing expertise is used in setting risk-based premiums.
Explore further
![](/sites/default/files/styles/por/public/45261_largeImage.jpg?itok=aCxNw1iN)