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Highlights of the 2007 National Flood Conference

More than 820 NFIP stakeholders traveled to Denver, Colorado, this year for the 24th annual National Flood Conference (NFC), held April 30 - May 2. Though most participants were NFC old-timers, 175 conferees were attending the NFC for the first time.

At the Opening General Session, five concurrent Town Hall meetings, and Closing General Session, attendees had the opportunity to learn about recent program changes and the hottest NFIP issues. In nearly 50 workshops held during the conference's 3 days, participants discussed in greater detail the challenges facing the program and asked questions specific to their constituencies. Workshops addressed issues from claims reporting and flood reform to the effect of flood map modernization on insurance agents, lenders, and public officials; severe repetitive losses; risk identification; condominium coverage; and agent errors and omissions issues.

Conferees were encouraged to take advantage of numerous wrap-around events (the golf tournament sponsored by Simsol Software and Valco USA, the opening reception hosted by Pilot Catastrophe Services, Inc., the Monday breakfast sponsored by Colonial Claims Corporation, and the final luncheon sponsored by EDS Corporation) to meet socially and network with other program stakeholders whose perspectives they might not ordinarily hear.

On Monday and Tuesday, 31 exhibitors offered information about their flood-related products and services. An awards ceremony held at the end of the Opening General Session provided FEMA with the opportunity to recognize nearly 10 of the NFIP's partners for their accomplishments. Among the after-conference activities on Thursday, two field trips took visitors to the sites of several past flood events. And, for the first time at the NFC, the Association of State Floodplain Managers (ASFPM) gave its examination for those seeking to become Certified Floodplain Managers.

Day 1: The NFIP Up Close

Master of Ceremonies Mike Moye and Doug Gore, Deputy Director of FEMA Region VIII, welcomed conference attendees to the Opening General Session on Monday morning. Drawing on several decades of work with NFIP issues, Gore established a framework for the rest of the conference by pointing out that the NFIP is like a stool supported by the three legs of engineering, floodplain management, and insurance/lending.

Updates were provided for these three components of the NFIP when Ed Connor, Deputy Director of Insurance for FEMA's Mitigation Division, next spoke, describing NFIP accomplishments made since the last NFC. In particular, a recent achievement that is expected to increase the NFIP's effectiveness in many areas of operation is the publication of recommendations from three NFIP evaluation studies that were begun in 2000. These recommendations are now being prioritized by the Mitigation Division, and steps are being taken to implement many of them.

According to Connor, progress already is being made in a number of other interrelated risk-awareness initiatives that have been under way for some time. One of these initiatives, the FloodSmart media campaign, has seen NFIP policy growth exceed 20 percent, with nearly 36 consecutive months of policy growth.

FEMA's Map Modernization initiative is another project that is improving risk awareness in the floodplain. Connor highlighted the effective use of public education and community support campaigns in facilitating the adoption of updated maps. He also praised the development of Digital Flood Insurance Rate Maps (D-FIRMs), which have increased the accuracy of risk assessment in floodplains.

Implementation of minimum NFIP training and education requirements for insurance agents is another initiative that has experienced successes in the last year. Connor announced that agent training has received a boost from numerous NFIP partners such as the National Association of Insurance Commissioners and the National Conference of Insurance Legislators, adding that 36 states have issued bulletins making flood insurance training mandatory for all agents who sell NFIP policies.

Connor concluded his remarks by noting the continued success of the Community Rating System in supporting local actions that exceed the NFIP's minimum floodplain management requirements and by describing some of the accomplishments of these communities, such as Fort Collins, Colorado.

Next on the program, Ed Pasterick, Senior Policy Advisor with FEMA's Mitigation Division, hosted a panel discussion called "What Do I Have to Do Next?" Using the scenario of a developer seeking to initiate construction in a floodplain, panelists representing three stakeholder groups (public officials, lenders, and insurance agents) described how NFIP mitigation and flood insurance coverage requirements are implemented at each step of the process.

The panelists agreed that two of the most difficult challenges faced by all NFIP stakeholders are improving education of the general public about flood risk and ensuring that NFIP stakeholders understand the program's policies and procedures.

Day 2: Town Halls Address Hottest Issues

Hundreds of conference participants packed into the NFC's Tuesday morning Town Halls, filling several of the meeting rooms and spilling into the lobby. Following are brief summaries of the topics discussed in each meeting.

Claims

After a short presentation about claim denial letters, lively discussion ensued in this Town Hall about the average time to process claims appeals; buildings in the course of construction; foundation damage; alternative claims handling procedures; policy language and "managing policyholder expectations up front," rather than when the claim is filed; and NFIP legislation pending in Congress (H.R. 1682).

Underwriting

Discussion in this Town Hall focused on the Group Flood Insurance Program; May and October 2007 NFIP changes; WYO Underwriting Bulletin 5; the Repetitive Loss Target Group and Severe Repetitive Loss Program; unique rating situations; inclusion of the current flood zone on grandfathered policies; the difference between the market value of property and actual reconstruction costs; and expanding coverage options for PRPs, such as insuring commercial buildings and contents.

Floodplain Management and Mapping

Discussion in this Town Hall centered around a number of mapping issues including Letters of Map Change and e-LOMAs; difficulties when printing FIRMettes; D-FIRMs; historic maps; procedures for correcting map errors; the ASFPM's No Adverse Impact toolkit; Advisory Base Flood Elevations; and levees and dams.

Lender Issues

Topics addressed in this Town Hall included buildings in the course of construction; the forthcoming revised edition of the Mandatory Purchase of Flood Insurance Guidelines handbook; determining "insurable value"; lender-placed flood insurance (in particular, the NFIP Mortgage Portfolio Protection Program versus the private sector); resolving flood zone determination discrepancies between lenders and WYOs; nonparticipating communities and availability of private-sector flood insurance; and secondary loans and compliance with the mandatory purchase requirement.

Marketing

Retention of flood insurance policies was the central theme of this Town Hall. Panelists discussed theories of non-renewal and retention tips. Presentations addressed the factors affecting retention and provided statistics showing NFIP retention demographics. Several retention case studies (AAA and DirectTV) were presented and relationships drawn to flood insurance. Additional retention strategies discussed included educating agents and consumers; targeting areas with low market penetration; gearing marketing efforts to Group Flood Insurance Program policyholders; tracking disaster assistance and retention; bundling premium discounts; simplifying the flood insurance policy; and creating automatic payment options.

Day 3: View from the Top - Mitigation Division and Levees

David Maurstad, Federal Insurance Administrator of the National Flood Insurance Program, was the featured speaker at the Midday General Session luncheon on Wednesday.

He described the assessments and reorganization of FEMA undertaken as a result of Hurricane Katrina to improve the delivery of response and recovery services in the aftermath of a disaster. He reported that FEMA's Mitigation Division, responsible for the NFIP, has been reorganized into three core business lines: risk analysis, risk reduction, and risk insurance. In addition to the Mitigation Division initiatives discussed by Ed Connor in the NFC's Opening Session, Maurstad spoke about recent developments in support of state and local mitigation planning, mitigation grant programs, NextGen technology, and legislative reform.

Before responding to questions from the audience, Maurstad recognized the NFIP's partnerships with the insurance and lender industries as well as state and local governments that have made it possible for thousands of flood victims to rebuild their lives since the devastating 2004 and 2005 hurricane seasons.

At the NFC's Closing General Session on Wednesday afternoon, the featured speaker was Peter Rabbon, Program Director of the U.S. Army Corps of Engineers (USACE) National Flood Risk Management Initiative.

According to Rabbon, there are an estimated 30,000 miles of levees in the nation and more than half of them protect buildings that are in NFIP communities. The USACE has built many of those levees and then transferred them to other agencies for operation and maintenance.

Rabbon explained the partnership between the USACE and FEMA to support provisionally accrediting levees until documentation can be submitted certifying the levees' safety. He also described several other levee safety initiatives that are more controversial. New warnings printed on FIRMs that state "This area protected from the one percent annual chance (100-year) flood by levee, dike, or other structures subject to possible failure or overtopping during larger flood" have resulted in what Rabbon called "push back" from some communities and developers.

Another USACE project that is expected to be unpopular with the public from the standpoints of recreation and aesthetics is the enforcement of vegetation guidelines for levees. According to Rabbon, the growth of trees and other vegetation on levees can make it harder to fight floods and more difficult to inspect the levees' safety. "If your levee is in a windy area and a tree is knocked over during a storm, you'll have a big hole that will allow erosion," he explained. "The ironic part is that the areas with a lot of urban development is where the consequence of failure would be greatest, and so you want to minimize the risk. And that is also where you have a group of people wanting those trees on the levees."

Join Us Next Year in Chicago at the End of May!

The 2008 National Flood Conference is scheduled for May 26-29 in Chicago. If you haven't attended an NFIP flood conference and want to be added to the mailing list of those receiving conference announcements early in 2008, contact Catherine King of the NFIP Bureau and Statistical Agent by telephone (301-918-1439) or by e-mail (cking28@csc.com).

See you next year in the Windy City!

Last updated on July 1, 2007