Flood Policy ICC Coverage Aids in Rebuilding
Flood recovery specialists are encouraging Hurricane Matthew disaster survivors to take a close look at their flood insurance policies. A sometimes overlooked section may help some of them with flood damage to rebuild as required to meet new building codes.
Claims for "Increased Cost of Compliance" benefits are filed separately from claims for contents or building loss. The coverage provides up to
Combined payments for increased cost coverage and other flood insurance claims for building damage cannot exceed:
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Claims for Increased Cost of Compliance, often known simply as ICC, can be filed if the floodplain administrator determines the insured structure is "substantially damaged" by flooding. This means that costs to repair the building to its pre-disaster condition equal or exceed 50 percent of the market value of the building.
Communities often may adopt floodplain requirements that are more restrictive than National Flood Insurance Program minimum requirements, so check with local officials for specific requirements.
An ICC claim may also be filed if the property has been damaged by flooding twice in the past 10 years. In addition, there must have been flood insurance claim payments for each of the two flood losses that equal 25 percent of the market value of the property.
Also, the community's floodplain management ordinance must have a "repetitive loss" provision requiring that the building be brought into compliance following the second flood loss.
ICC can be used on any of the mitigation solutions below to make properties more flood-resistant:
* Elevating properties above the Base Flood Elevation as shown on the community's Flood Insurance Rate Map; if a community has adopted a "freeboard" in its flood ordinance, the ICC will help to elevate structures to that higher flood elevation;
* Relocating to a new site;
* Demolishing flood-damaged buildings;
* Flood-proofing, or making a non-residential building watertight through modifications that reduce the potential for flood damage.
NFIP policyholders may want to check with local floodplain management officials before deciding on which options to pursue.
Claims representatives can assist in preparing claims. Claimants are encouraged to begin obtaining contractor bids for necessary work.
When the work is completed, local officials will inspect and issue a certificate of occupancy, or a certificate of compliance or completion. Once this document is provided to the claims representative, final payment can be made.
For more information on ICC coverage, contact the insurance company providing the flood insurance or call the National Flood Insurance Program toll-free. For voice, Video Relay Service or 711, call 800-427-4661. TTY users call 800-462-7585.
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