42 U.S.C. § 4013 | Nature and limitation of insurance coverage

(a)

Regulations respecting general terms and conditions of insurability

section 4025 of this title section 4051 of this title section 4012 of this titleThe Administrator shall from time to time, after consultation with the advisory committee authorized under , appropriate representatives of the pool formed or otherwise created under , and appropriate representatives of the insurance authorities of the respective States, provide by regulation for general terms and conditions of insurability which shall be applicable to properties eligible for flood insurance coverage under , including—

(1)

the types, classes, and locations of any such properties which shall be eligible for flood insurance;

(2)

the nature and limits of loss or damage in any areas (or subdivisions thereof) which may be covered by such insurance;

(3)

the classification, limitation, and rejection of any risks which may be advisable;

(4)

appropriate minimum premiums;

(5)

appropriate loss-deductibles; and

(6)

any other terms and conditions relating to insurance coverage or exclusion which may be necessary to carry out the purposes of this chapter.

(b)

Regulations respecting amount of coverage

In addition to any other terms and conditions under subsection (a), such regulations shall provide that—

(1)

section 4015 of this title section 4014(a)(1) of this title any flood insurance coverage based on chargeable premium rates under which are less than the estimated premium rates under shall not exceed—

(A)

in the case of residential properties—

(i)

$35,000 aggregate liability for any single-family dwelling, and $100,000 for any residential structure containing more than one dwelling unit,

(ii)

$10,000 aggregate liability per dwelling unit for any contents related to such unit, and

(iii)

in the States of Alaska and Hawaii, and in the Virgin Islands and Guam; the limits provided in clause (i) of this sentence shall be: $50,000 aggregate liability for any single-family dwelling, and $150,000 for any residential structure containing more than one dwelling unit;

(B)

in the case of business properties which are owned or leased and operated by small business concerns, an aggregate liability with respect to any single structure, including any contents thereof related to premises of small business occupants (as that term is defined by the Administrator), which shall be equal to (i) $100,000 plus (ii) $100,000 multiplied by the number of such occupants and shall be allocated among such occupants (or among the occupant or occupants and the owner) under regulations prescribed by the Administrator; except that the aggregate liability for the structure itself may in no case exceed $100,000; and

(C)

section 4012 of this title in the case of church properties and any other properties which may become eligible for flood insurance under —

(i)

$100,000 aggregate liability for any single structure, and

(ii)

$100,000 aggregate liability per unit for any contents related to such unit; and

(2)

section 4014(a)(1) of this title in the case of any residential building designed for the occupancy of from 1 to 4 families for which the risk premium rate is determined in accordance with the provisions of , additional flood insurance in excess of the limits specified in clause (i) of subparagraph (A) of paragraph (1) shall be made available, with respect to any single such building, up to an aggregate liability (including such limits specified in paragraph (1)(A)(i)) of $250,000;

(3)

section 4014(a)(1) of this title in the case of any residential property for which the risk premium rate is determined in accordance with the provisions of , additional flood insurance in excess of the limits specified in clause (ii) of subparagraph (A) of paragraph (1) shall be made available to every insured upon renewal and every applicant for insurance so as to enable any such insured or applicant to receive coverage up to a total amount (including such limits specified in paragraph (1)(A)(ii)) of $100,000;

(4)

section 4014(a)(1) of this title in the case of any nonresidential building, including a church, for which the risk premium rate is determined in accordance with the provisions of , additional flood insurance in excess of the limits specified in subparagraphs (B) and (C) of paragraph (1) shall be made available with respect to any single such building, up to an aggregate liability (including such limits specified in subparagraph (B) or (C) of paragraph (1), as applicable) of $500,000, and coverage shall be made available up to a total of $500,000 aggregate liability for contents owned by the building owner and $500,000 aggregate liability for each unit within the building for contents owned by the tenant; and

(5)

section 4015 of this title section 4014(a)(1) of this title any flood insurance coverage which may be made available in excess of the limits specified in subparagraph (A), (B), or (C) of paragraph (1), shall be based only on chargeable premium rates under , which are not less than the estimated premium rates under , and the amount of such excess coverage shall not in any case exceed an amount equal to the applicable limit so specified (or allocated) under paragraph (1)(C), (2), (3), or (4), as applicable.

(c)

Effective date of policies

(1)

Waiting period

September 23, 1994September 23, 1994Except as provided in paragraph (2), coverage under a new contract for flood insurance coverage under this chapter entered into after , and any modification to coverage under an existing flood insurance contract made after , shall become effective upon the expiration of the 30-day period beginning on the date that all obligations for such coverage (including completion of the application and payment of any initial premiums owed) are satisfactorily completed.

(2)

Exception

The provisions of paragraph (1) shall not apply to—

(A)

the initial purchase of flood insurance coverage under this chapter when the purchase of insurance is in connection with the making, increasing, extension, or renewal of a loan;

(B)

section 4101(f) of this title section 4101(h) of this title the initial purchase of flood insurance coverage pursuant to a revision or updating of floodplain areas or flood-risk zones under , if such purchase occurs during the 1-year period beginning upon publication of notice of the revision or updating under ; or

(C)

the initial purchase of flood insurance coverage for private property if—

(i)

the Administrator determines that the property is affected by flooding on Federal land that is a result of, or is exacerbated by, post-wildfire conditions, after consultation with an authorized employee of the Federal agency that has jurisdiction of the land on which the wildfire that caused the post-wildfire conditions occurred; and

(ii)

the flood insurance coverage was purchased not later than 60 days after the fire containment date, as determined by the appropriate Federal employee, relating to the wildfire that caused the post-wildfire conditions described in clause (i).

(d)

Optional high-deductible policies for residential properties

(1)

Availability

In the case of residential properties, the Administrator shall make flood insurance coverage available, at the option of the insured, that provides for a loss-deductible for damage to the covered property in various amounts, up to and including $10,000.

(2)

Disclosure

(A)

Form

The Administrator shall provide the information described in subparagraph (B) clearly and conspicuously on the application form for flood insurance coverage or on a separate form, segregated from all unrelated information and other required disclosures.

(B)

Information

The information described in this subparagraph is—

(i)

information sufficient to inform the applicant of the availability of the coverage option required by paragraph (1) to applicants for flood insurance coverage; and

(ii)

a statement explaining the effect of a loss-deductible and that, in the event of an insured loss, the insured is responsible out-of-pocket for losses to the extent of the deductible selected.

Pub. L. 90–448, title XIII, § 1306Aug. 1, 196882 Stat. 575 Pub. L. 92–213, § 2(c)(2)Dec. 22, 197185 Stat. 775 Pub. L. 93–234, title I, § 101Dec. 31, 197387 Stat. 977 Pub. L. 95–128, title VII, § 704(a)Oct. 12, 197791 Stat. 1145 Pub. L. 98–181, title INov. 30, 198397 Stat. 1229 Pub. L. 100–242, title V, § 544(a)Feb. 5, 1988101 Stat. 1940 Pub. L. 100–628, title X, § 1086(a)Nov. 7, 1988102 Stat. 3278 Pub. L. 100–707, title I, § 109oNov. 23, 1988102 Stat. 4709 Pub. L. 101–137, § 1(c)Nov. 3, 1989103 Stat. 824 Pub. L. 101–508, title II, § 2302(d)Nov. 5, 1990104 Stat. 1388–23 Pub. L. 103–325, title VSept. 23, 1994108 Stat. 2269 Pub. L. 112–141, div. F, title IIJuly 6, 2012126 Stat. 944 Pub. L. 113–89, § 12Mar. 21, 2014128 Stat. 1025(, , ; , , ; , , ; , , ; [title IV, § 451(d)(1)], , ; , , ; , , ; (), , ; , , ; , , ; , §§ 552(a), 573, 579(a), , , 2278, 2284; , §§ 100228, 100238(b)(1), 100241, , , 958, 962; , , .)

Editorial Notes

References in Text

Pub. L. 90–448Aug. 1, 196882 Stat. 572 section 4001 of this titleThis chapter, referred to in subsecs. (a)(6) and (c)(1), (2)(A), was in the original a reference to “this title” meaning title XIII of , , , known as the National Flood Insurance Act of 1968, which is classified principally to this chapter. For complete classification of this Act to the Code, see Short Title note set out under and Tables.

Amendments

Pub. L. 113–892014—Subsec. (d). added subsec. (d).

Pub. L. 112–141, § 100238(b)(1)2012—Subsec. (a). , substituted “Administrator” for “Director” in introductory provisions.

Pub. L. 112–141, § 100238(b)(1)Subsec. (b)(1)(B). , substituted “Administrator” for “Director” in two places.

Pub. L. 112–141, § 100228(1)Subsec. (b)(2). , substituted “in the case of any residential building designed for the occupancy of from 1 to 4 families” for “in the case of any residential property” and “shall be made available, with respect to any single such building, up to an aggregate liability (including such limits specified in paragraph (1)(A)(i)) of $250,000” for “shall be made available to every insured upon renewal and every applicant for insurance so as to enable such insured or applicant to receive coverage up to a total amount (including such limits specified in paragraph (1)(A)(i)) of $250,000”.

Pub. L. 112–141, § 100228(2)Subsec. (b)(4). , substituted “in the case of any nonresidential building, including a church,” for “in the case of any nonresidential property, including churches,” and “shall be made available with respect to any single such building, up to an aggregate liability (including such limits specified in subparagraph (B) or (C) of paragraph (1), as applicable) of $500,000, and coverage shall be made available up to a total of $500,000 aggregate liability for contents owned by the building owner and $500,000 aggregate liability for each unit within the building for contents owned by the tenant” for “shall be made available to every insured upon renewal and every applicant for insurance, in respect to any single structure, up to a total amount (including such limit specified in subparagraph (B) or (C) of paragraph (1), as applicable) of $500,000 for each structure and $500,000 for any contents related to each structure”.

Pub. L. 112–141, § 100241Subsec. (c)(2)(C). , added subpar. (C).

Pub. L. 103–325, § 573(a)(1)1994—Subsec. (b)(2). , substituted “a total amount (including such limits specified in paragraph (1)(A)(i)) of $250,000” for “an amount of $150,000 under the provisions of this clause”.

Pub. L. 103–325, § 573(a)(2)Subsec. (b)(3). , substituted “a total amount (including such limits specified in paragraph (1)(A)(ii)) of $100,000” for “an amount of $50,000 under the provisions of this clause”.

Pub. L. 103–325, § 573(a)(3)section 4014(a)(1) of this titleSubsec. (b)(4). , added par. (4) and struck out former par. (4) which read as follows: “in the case of business property owned, leased, or operated by small business concerns for which the risk premium rate is determined in accordance with the provisions of , additional flood insurance in excess of the limits specified in subparagraph (B) of paragraph (1) shall be made available to every such owner, lessee, or operator in respect to any single structure, including any contents thereof, related to premises of small business occupants (as that term is defined by the Director), up to an amount equal to (i) $250,000 plus (ii) $200,000 multiplied by the number of such occupants which coverage shall be allocated among such occupants (or among the occupant or occupants and the owner) in accordance with the regulations prescribed by the Director pursuant to such subparagraph (B), except that the aggregate liability for the structure itself may in no case exceed $250,000;”.

Pub. L. 103–325, § 573(b)(1)Subsec. (b)(5). , substituted a period for “; and” at end.

Pub. L. 103–325, § 573(b)(2)section 4012a of this titleSubsec. (b)(6). , struck out par. (6) which read as follows: “the flood insurance purchase requirements of do not apply to the additional flood insurance limits made available in excess of twice the limits made available under paragraph (1).”

Pub. L. 103–325, § 579(a)Subsec. (c). , added subsec. (c).

Pub. L. 103–325, § 552(a), struck out subsec. (c) which related to schedule for payment of flood insurance for structures on land subject to imminent collapse or subsidence.

Pub. L. 101–508September 30, 1995September 30, 19911990—Subsec. (c)(7). substituted “” for “”.

Pub. L. 101–137September 30, 1991September 30, 19891989—Subsec. (c)(7). substituted “” for “”.

Pub. L. 100–2421988—Subsec. (c). added subsec. (c).

Pub. L. 100–628Subsec. (c)(1)(A). substituted “following” for “Following” in cls. (i) and (ii).

Pub. L. 100–707Subsec. (c)(5). substituted “Disaster Relief and Emergency Assistance Act” for “Disaster Relief Act of 1974”.

Pub. L. 98–1811983—Subsecs. (a), (b)(1)(B), (4). substituted “Director” for “Secretary” wherever appearing.

Pub. L. 95–1281977—Subsec. (b)(2). added par. (2) and redesignated former par. (2) as (5).

Pub. L. 95–128Subsec. (b)(3), (4). added pars. (3) and (4).

Pub. L. 95–128Subsec. (b)(5). redesignated former par. (2) as (5), struck out “(or allocated to any person under subparagraph (B) of such paragraph)” after “paragraph (1)”, and inserted “under paragraph (1)(C), (2), (3), or (4), as applicable” after “(or allocated)”.

Pub. L. 95–128Subsec. (b)(6). added par. (6).

Pub. L. 93–234, § 101(a)1973—Subsec. (b)(1)(A). , in increasing limits of coverage, struck out following introductory text “residential properties” the clause “which are designed for the occupancy of from one to four families”; substituted provisions in cl. (i) “$35,000 aggregate liability for any single-family dwelling, and $100,000 for any residential structure containing more than one dwelling unit” for “$17,500 aggregate liability for any dwelling unit, and $30,000 for any single dwelling structure containing more than one dwelling unit”; increased cl. (ii) limits to $10,000 from $5,000 and added cl. (iii).

Pub. L. 93–234, § 101(b)Subsec. (b)(1)(B). , substituted “$100,000” for “$30,000” in cl. (i), for “$5,000” in cl. (ii), and for “$30,000” in exception provision.

Pub. L. 93–234, § 101(c)Subsec. (b)(1)(C). , increased cl. (i) limits to $100,000 from $30,000 and substituted cl. (ii) “$100,000 aggregate liability per unit for any contents related to such unit” for “$5,000 aggregate liability per dwelling unit for any contents related to such unit in the case of residential properties, or per occupant (as that term is defined by the Secretary) for any contents related to the premises occupied in the case of any other properties”.

Pub. L. 92–2131971—Subsec. (b)(1)(C). inserted “church properties, and” before “any other properties which may become”.

Statutory Notes and Related Subsidiaries

Effective Date of 1988 Amendment

Pub. L. 100–242, title V, § 544(b)Feb. 5, 1988101 Stat. 1942

Feb. 5, 1988“The amendment made by this section [amending this section] shall become effective on the date of the enactment of this Act [].”

, , , provided that:

Effective Date

Aug. 1, 1968Aug. 1, 1968section 1377 of Pub. L. 90–448 section 4001 of this titleSection effective 120 days following , or such later date prescribed by the Secretary but in no event more than 180 days following , see , set out as a note under .

Savings Provision

Pub. L. 103–325, title V, § 552(c)Sept. 23, 1994108 Stat. 2269Sept. 23, 1994section 552(b) of Pub. L. 103–325, , , required the Director of the Federal Emergency Management Agency to make payments under flood insurance contracts based on commitments made before the expiration of the 1-year period beginning on , pursuant to the authority under subsec. (c) of this section or , formerly set out below.

Transfer of Functions

section 315(a)(1) of Title 6For transfer of all functions, personnel, assets, components, authorities, grant programs, and liabilities of the Federal Emergency Management Agency, including the functions of the Under Secretary for Federal Emergency Management relating thereto, to the Federal Emergency Management Agency, see , Domestic Security.

November 25, 2002section 542 of Title 6For transfer of functions, personnel, assets, and liabilities of the Federal Emergency Management Agency, including the functions of the Director of the Federal Emergency Management Agency relating thereto, to the Secretary of Homeland Security, and for treatment of related references, see former section 313(1) and sections 551(d), 552(d), and 557 of Title 6, Domestic Security, and the Department of Homeland Security Reorganization Plan of , as modified, set out as a note under .

Transition Phase

Pub. L. 103–325, title V, § 552(b)Sept. 23, 1994108 Stat. 2269 Pub. L. 103–325Sept. 23, 1994, , , permitted the Director of the Federal Emergency Management Agency to pay amounts under flood insurance contracts for demolition or relocation of structures as provided in subsec. (c) of this section (as in effect immediately before the enactment of ), during the 1-year period beginning on .