NFIP Flood Adjuster flashcards

33 cards. Read the term and the definition here. The deck at the top of this page is optional.

NFIP

The National Flood Insurance Program, a federal program administered by FEMA that provides flood insurance through Write Your Own carriers and participating communities.

Write Your Own (WYO)

Private insurers that issue and service Standard Flood Insurance Policies under their own names while following federal NFIP rules and policy wording.

Emergency Program limits

Reduced coverage available in communities that have not entered the Regular Program, generally $35,000 building and $10,000 contents for a 1-4 family residence.

30-day waiting period

The standard delay before a new NFIP policy or coverage increase takes effect, with exceptions such as lender-required coverage at loan closing and certain map changes.

General condition of flooding

The SFIP requirement that flooding affect two or more properties or at least two acres of normally dry land, distinguishing flood from a single-property water loss.

Mudflow

A river of liquid and flowing mud on the surface of normally dry land, which the SFIP treats as flood when it results from a covered flooding event.

Community participation

The requirement that a community adopt and enforce floodplain management ordinances to be eligible for NFIP coverage; policies cannot be written in non-participating communities.

Statutory maximum limits

The caps set by law: $250,000 building and $100,000 contents for 1-4 family residences, and $500,000 each for non-residential buildings and contents.

RCBAP

The Residential Condominium Building Association Policy, which insures the condominium building's common elements and provides building coverage per unit plus contents per unit.

Basement coverage limitation

The SFIP covers only specified building elements and equipment in a basement, such as the furnace, water heater, and electrical panels, and excludes finished contents and furnishings.

Increased Cost of Compliance

Up to $30,000 per building for costs to comply with a floodplain management ordinance after a covered loss, triggered by a substantially or repetitively damaged determination.

Contents coverage

Personal property coverage that must be purchased separately from building coverage and is subject to its own limit and deductible under the SFIP.

Loss of use exclusion

The SFIP does not provide additional living expense or fair rental value benefits; there is no loss-of-use coverage for flood claims.

Property removed to safety

Coverage for insured property moved to protect it from flood, generally limited to 45 days from the date of loss and subject to policy limits.

Proof of loss

A signed and sworn statement the insured must submit within 60 days of the insurer's request, documenting the amount claimed and supporting the loss.

Concurrent causation

A situation where flood and a non-flood peril both contribute to the loss; the SFIP pays only the portion attributable to flood.

High-water mark

A visible line or stain left by floodwater on a building or object, used by the adjuster to document the depth and extent of inundation.

Notice of loss

The insured's prompt notification to the insurer after a flood loss; the adjuster must document the timeline and evaluate any prejudice from delay.

Repetitive loss property

A property that has received two or more flood claim payments of $1,000 or more within a 10-year period, which can trigger higher deductibles and mitigation requirements.

Claim file documentation

The adjuster's record of inspection, photographs, measurements, damage estimate, and coverage analysis that supports the payment decision and must be retained.

Fraud indicators

Signs such as inflated inventories, receipts inconsistent with the property, recent large purchases, and inconsistent statements that suggest a claim may be fraudulent.

Actual cash value

Replacement cost new minus depreciation, the standard SFIP valuation method for building and contents unless replacement cost coverage was purchased.

Replacement cost coverage

Settlement based on the cost to repair or replace with new materials of like kind and quality, available for the building and certain contents when purchased.

80% replacement cost requirement

The insured must carry at least 80% of the building's replacement cost to receive full replacement cost settlement; otherwise the loss is settled proportionally.

180-day repair requirement

The period after a loss within which the insured must repair or replace the damaged building to receive the replacement cost differential above ACV.

Deductible application

The SFIP deductible applies once per loss occurrence and separately to building and contents, and is subtracted before payment.

Depreciation

The reduction in value from age, wear, and obsolescence that the adjuster applies to determine actual cash value and must document in the estimate.

Damage estimate standards

The adjuster's line-item estimate using local unit costs that separates building from contents and flood damage from pre-existing or non-covered damage.

Adjuster licensing

The requirement that adjusters hold a state license and appointment and meet NFIP certification and continuing education requirements to handle flood claims.

Good faith and fair dealing

The adjuster's duty to treat the insured honestly and fairly, without misrepresenting coverage, limits, or the claims process.

Conflict of interest

A situation where the adjuster's personal or financial interest could influence the claim decision and must be disclosed and avoided.

Claim record retention

The NFIP requirement to retain claim files and supporting documentation for the specified period; records must not be altered, backdated, or destroyed.

Unauthorized practice

Adjuster conduct outside the license scope, such as giving legal advice or acting as a public adjuster for the insured, which is prohibited.