On August 10, 2015, the Federal Emergency Management Agency (“FEMA”) issued Write Your Own (“WYO’) Bulletin W-15038, which extended the current four-year time to complete and Increased Cost of Compliance (“ICC”) related work to six-years.
The Bulletin begins by explaining what ICC benefits are, their history, and how they are paid out to flood policyholders:
The National Flood Insurance Program (NFIP) provides Increased Cost of Compliance (ICC) coverage to pay up to $30,000 towards the cost of compliance with State or local floodplain management laws or ordinances (Section II1.D – increased Cost of Compliance of the Standard Flood Insurance Policy (SFIP)). The Standard Flood Insurance Policies (SFIPs) provide two years from the date of loss for the policyholder to complete the ICC qualifying work in Section III, Coverage D.
In FEMA bulletins w-13006 and w-13024, the Associate Administrator for the Federal Insurance and Mitigation Administration exercised his waiver authority to conditionally allow for advance payments of ICC funds (up to ½ of the amount for the qualifying work or a maximum of $15,000) and extended the two year time frame to complete the ICC mitigation to four years from the date of loss. In the event the required mitigation measures are not completed within four years, the remaining ICC benefit cannot be paid and any advance payment received by the policyholder must be returned.
The increase in the time limit comes as a result of mitigation grant projects:
ICC benefits may also be used as the non-Federal cost share for FEMA mitigation grant projects where the cost share is the responsibility of the NFIP policyholder. The mitigation grant process, however, may often extend beyond the four-years from the date of the flood loss.
To allow for both processes to work with one another and not limit an insured’s ability to collect their benefits, FEMA has increased the time to complete the ICC related work to six-years. “NFIP policyholders will now have six years to complete the approved ICC mitigation measures starting on the date of the underlying flood insurance indemnity loss if the loss occurred on or after January 1, 2011.”
This will come as great help to many policyholders still working to resolve their Superstorm Sandy claims and just now beginning to rebuild, nearly three years later. Every little bit counts.
As always, I’ll leave you with a (mildly) related tune, Time Has Come Today, by The Chamber Brothers:
Click here to view the video.