FEMA Sends Update as NFIP’s Risk Rating 2.0 Implementation Nears
Last week, FEMA sent out a notice to Write-Your-Own (WYO) insurance companies stating that they anticipate that quoting and policy issuance for Phase 1 of Risk Rating 2.0 policies—policies effective Oct. 1, 2021, or later—will be available starting on Monday, Aug. 16.
This is a slight delay as FEMA had previously said WYO insurers would be able to begin quoting for policies beginning on Aug. 1.
Although quoting and policy issuance has been delayed until at least Aug. 16, the rating engine website went live on Aug. 1 for users to test their connection. FEMA also noted they will communicate when the rates may be used for quoting and when policy issuance can begin.
As reported in the News & Views e-newsletter throughout the year, Risk Rating 2.0 is FEMA's new pricing methodology for the National Flood Insurance Program (NFIP). Despite the quoting delay, it is still scheduled to be implemented on Oct. 1.
All new policies effective on or after Oct. 1, 2021, must be issued under Risk Rating 2.0. Existing policies renewing with effective dates between Oct. 1, 2021, and March 31, 2022, can renew under the legacy rating plan or renew their policy under Risk Rating 2.0. All existing policies with renewal dates on or after April 1, 2022, will be renewed under Risk Rating 2.0.
Additionally, FEMA is currently providing agent training webinars throughout the month of August. Important information about the webinars such as dates, times and how to register, is listed in this FEMA bulletin. The bulletin also includes important information about continuing education (CE) credits, including which states have approved the webinars for CE credits. In addition, there are still some pending approvals for CE credits that are outlined within the bulletin.
The Risk Rating 2.0 – Equity in Action webinars are free to attend, but spaces are limited to 1,500 attendees per event. Register early if you are interested. The webinar will provide agents with the latest information on how and when Risk Rating 2.0 will be implemented. It will also discuss the following topics:
- What is Risk Rating 2.0 – Equity in Action?
- What led to this NFIP transformation?
- The NFIP today: What is changing?
- What is not changing?
- How will current policies transition?
The Big “I" believes that Risk Rating 2.0, if properly implemented, has the potential to improve the NFIP experience for agents and consumers, but emphasizes that the rollout of the program will be critical in determining the success of the effort.