CFM Flood Insurance & NFIP

Question 1

What federal legislation established the National Flood Insurance Program (NFIP)?

Accepted Answer

The National Flood Insurance Act of 1968

Answer

The NFIP was created by the National Flood Insurance Act of 1968, which authorized the federal government to make flood insurance available to communities that adopt and enforce floodplain management regulations.

Question 2

Under the NFIP, what is the standard maximum building coverage limit for a single-family residential structure?

Accepted Answer

$250,000

Answer

The standard NFIP flood insurance policy provides a maximum of $250,000 in building coverage for residential structures.

Question 3

Which federal agency administers the National Flood Insurance Program?

Accepted Answer

Federal Emergency Management Agency (FEMA)

Answer

FEMA administers the NFIP, which includes flood hazard mapping, floodplain management regulations, and the flood insurance program.

Question 4

What is the waiting period before a new Standard Flood Insurance Policy (SFIP) goes into effect?

Accepted Answer

30 days

Answer

There is generally a 30-day waiting period before a new NFIP policy takes effect, with limited exceptions such as when insurance is purchased in connection with a loan closing.

Question 5

A community that fails to enforce NFIP floodplain management requirements may be placed on what status?

Accepted Answer

Probation or Suspension

Answer

Communities that fail to enforce NFIP requirements can be placed on probation (with a $50 surcharge on policies) or suspended from the NFIP entirely, which means federal flood insurance becomes unavailable to property owners.

CFM - Certified Floodplain Manager Practice Test

CFM - Certified Floodplain Manager Practice Test

CFM Flood Insurance & NFIP