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Overview of the Community Rating System (CRS) Program
 The
National Flood Insurance Program's (NFIP) Community Rating System (CRS) is a
voluntary incentive program that recognizes and encourages community
floodplain management activities that exceed the minimum NFIP requirements.
As a result, flood insurance premium rates are discounted to reflect the
reduced flood risk resulting from the community actions meeting the three
goals of the CRS: (1) reduce flood losses; (2) facilitate accurate insurance
rating; and (3) promote the awareness of flood insurance.
The NFIP has been
successful in requiring new buildings to be protected from damage by a
100-year flood. However, flood damage still results from floods greater than
the 100-year flood and from flooding in unmapped areas. Under the Community
Rating System (CRS), there is an incentive for communities to do more than
just regulate construction of new buildings to minimum national standards.
Under the CRS, flood insurance premiums are adjusted to reflect community
activities that reduce flood damage to existing buildings, manage
development in areas not mapped by the NFIP, protect new buildings beyond
the minimum NFIP protection level, help insurance agents obtain flood data,
and help people obtain flood insurance.
For CRS
participating communities, flood insurance premium rates are discounted in
increments of 5%; i.e., a Class 1 community would receive a 45% premium
discount, while a Class 9 community would receive a 5%. The CRS classes for
local communities are based on 18 creditable activities, organized under
four categories: (i) Public Information, (ii) Mapping and Regulations, (iii)
Flood Damage Reduction, and (iv) Flood Preparedness.
Nationwide there are
1002 communities receiving flood insurance premium discounts based on their
implementation of local mitigation, outreach, and educational activities
that go well beyond minimum NFIP requirements. While premium discounts are
one of the benefits of participation in CRS, it is more important that these
communities are carrying out activities that save lives and reduce property
damage. These 1002 communities represent a significant portion of the
Nation's flood risk as evidenced by the fact that over 66% of the NFIP's
policy base is located in these communities. Communities receiving premium
discounts through the CRS cover a full range of sizes from small to large,
and a broad mixture of flood risks including coastal and riverine.
Credit
points earned, classification awarded, and premium reductions given for
communities in the National Flood
Insurance Program Community Rating System. |
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Premium Reduction |
|
Credit Points |
Class Rating |
SFHA* |
Non-SFHA** |
| 4,500+ |
1 |
45% |
5% |
| 4,000 – 4,499 |
2 |
40% |
5% |
| 3,500 – 3,999 |
3 |
35% |
5% |
| 3,000 – 3,499 |
4 |
30% |
5% |
| 2,500 – 2,999 |
5 |
25% |
5% |
| 2,000 – 2,499 |
6 |
20% |
5% |
| 1,500 – 1,999 |
7 |
15% |
5% |
| 1,000 – 1,499 |
8 |
10% |
5% |
| 500 – 999 |
9 |
5% |
5% |
| 0 – 499 |
10 |
0 |
0 |
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* Special Flood Hazard Area
** Preferred Risk Policies are available only for properties in X Zones that
are shown to have a minimal risk of flood damage. The Preferred Risk Policy does
not receive premium rate credits under the CRS because it already has a lower
premium than other policies. Although they are in SFHAs, Zones AR and A99 are
limited to a 5% discount.
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The following
chart lists the
1002 CRS communities by class, as of May 1, 2004.
Louisville Metro CRS Rating: The
Louisville/Jefferson County Metropolitan Sewer District (MSD) is the CRS
program coordinator for Louisville Metro and is responsible for completion
of all CRS activities. Currently, Louisville Metro has a Class 6 Rating and
receives a 20% discount on flood insurance premium rates. A Class 6 is the
highest-class rating in the State of Kentucky, and this means that over
6,600 policyholders in Louisville Metro will benefit from a reduction in
annual flood insurance premiums.
CRS Activities: The CRS Program
describes eighteen floodplain management activities that can be credited by
the CRS. Each of the eighteen activities further involves two or more
elements. The CRS activities are divided into four categories or series, as
follows.
- Public Information: This
series credits a program that advises people about the flood hazard, flood
insurance, ways to reduce flood damage, and promote hazard awareness.
- MSD sends an annual mailing
to over 20,000 FEMA-designated floodplain properties in an effort to
inform property owners of the flood hazard. The cover letter clearly
states that the recipient’s property is subject to flooding and is
located in the floodplain. The mailing also includes information on
flood safety, flood warning and preparedness, flood insurance
requirements, property protection measures and other useful information.
- MSD also sends an annual
outreach geared specifically to realtors, lenders, and insurers. The
mailing is sent to over 900 local lenders, insurers, and realtors to
inform them of the local flood hazard, flood insurance requirements and
that MSD provides free technical and floodproofing assistance.
- MSD provides technical
assistance to residents for map information and flood protection
assistance. These services are provided as a public service to the
inquirer. The CRS encourages the community to publicize the availability
of these flood hazard awareness services.
- MSD also publishes a
brochure entitled, "Louisville and Jefferson County’s Local Flood
Hazard" that explains how to determine if a property is in the
floodplain and how to receive property protection assistance and other
valuable information.
- Mapping and Floodplain
Regulations: Activities in this category are geared toward floodplain
programs that provide increased protection to new development through
regulations, mapping, stormwater management and designating open space.
These activities include mapping areas not shown on the Flood Insurance
Rate Map (FIRM), preserving open space and enforcing higher regulatory
standards. MSD has become a national model for floodplain regulations in
this category due to the fully developed watershed concept and the revised
Floodplain Ordinance.
- Flood Damage Reduction:
This CRS category credits programs that reduce potential damages in areas
that are flood prone. While most of the points in the CRS are given for
acquisition and relocation of flood prone properties, mitigation
practices, such as floodproofing or retrofitting a flood prone building,
are equally beneficial to reducing flood damages to the community. Extra
credit also is provided for addressing repetitive loss problems and
individual properties. Credit also is awarded in this category for
regularly maintaining the community’s drainage systems, enforcing stream
dumping regulations, and inspecting waterways after a storm.
- Flood Preparedness: This CRS
category credits the community for the local flood-warning program and the
flood response plan. Informing residents of emergency and safety measures
is also credited.
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