Flood insurance rate increase: why the bill rises and when it stops
47 % of single-family flood policies still paid less than their full-risk premium on July 31, 2026. Enter your two amounts to count the increases left.
Renewals before your bill reaches the full-risk price
2 renewals
Increases of up to 18 % a year on the capped part. Next five bills: $6,483 in total.
| Renewal 1 (capped) | $1,263 |
| Renewal 2 | $1,305 |
| Renewal 3 | $1,305 |
| Renewal 4 | $1,305 |
| Renewal 5 | $1,305 |
| Five years at the full-risk price at once | $6,525 |
Fixed charges kept outside the cap: $72 a year (Federal Policy Fee and HFIAA surcharge). Rates FEMA sets each year can move the full-risk price itself.
Compiled by Radif Partners · Where the numbers come from · FEMA and OpenFEMA files, rules read in 42 U.S.C. and 44 CFR · not a quote
Federal flood bills keep rising because many policies still pay less than the full-risk premium FEMA now computes for each building, and the law only lets that gap close in steps. For a main home the premium may go up by at most 18 % a year (42 U.S.C. 4015(e)); for a second home, a rental, a business property or a severe repetitive loss property it rises by 25 % a year (42 U.S.C. 4014(a)(2)). The flat Federal Policy Fee and HFIAA surcharge sit outside the cap. On July 31, 2026, 47 % of single-family policies were still below their full-risk level. The national median bill went from $780 on August 31, 2023 to $1,081 on July 31, 2026, up 39 %. From today's median to the median full-risk bill of $1,305, a main home has 2 renewals of increases left. A lapse of 30 days or more can end the discount at once.
The gap the increases are closing
For a long time, many federal flood policies paid less than their risk implied, in part through discounts the law grants to buildings older than the first flood map of their community. Since October 1, 2021, new policies pay the full-risk premium that FEMA's current method computes building by building. Existing policies were moved onto the same method, but not all at once: their price climbs toward the new level a step at a time. FEMA's pricing page sums it up: existing statutory limits keep most rates from rising more than 18 % a year.
That is why two neighbors with similar houses can see different increases. One may already pay the full price and only see FEMA's general rate changes. The other may have years of capped increases left. The declarations page tells them apart: it always shows the Full-Risk Premium, and, when it applies, an Annual Increase Cap Discount line with the amount still being waived.
The two caps in the statute
The general rule is in 42 U.S.C. 4015(e): the chargeable risk premium rate "for any property" may not go up by more than 18 % in a year. The faster track is in the same subsection, which sends the categories listed in 42 U.S.C. 4014(a)(2) up by 25 % a year: a residence that is not the primary residence of an individual, a severe repetitive loss property, a property whose flood claims have added up to its market value, a business property, and a building substantially damaged or improved by more than half its value since July 6, 2012.
The 18 % limit also has exceptions in the text. A premium can rise beyond it when the owner increases the coverage or lowers the deductible, when the community has been downgraded in FEMA's Community Rating System, or when the policy was misrated. Properties leased from the federal government on the river side of a levee or seaward of a seawall are outside the cap entirely.
What sits outside the cap
The cap is built into what FEMA calls the discounted premium. Several items of the bill are not part of it. The Federal Policy Fee, $47, and the HFIAA surcharge, $25 for a main home or $250 for any other building, are flat amounts added on top. The Reserve Fund Assessment is 18 % of the discounted premium, so it rises in proportion with it. The FEMA Flood Insurance Manual lists these as "not part of the full-risk premium or discounted premium". In practice, the total on the bill can move by a slightly different percentage than the capped premium, which is why the calculator above takes the flat charges out before applying the cap.
What the policy file shows since 2023
| Policies in force on | Single-family policies | Median bill | Change |
|---|---|---|---|
| August 31, 2023 | 3,114,530 | $780 | |
| August 31, 2024 | 3,020,686 | $889 | +14.0 % |
| August 31, 2025 | 2,968,812 | $971 | +9.2 % |
| July 31, 2026 | 2,813,889 | $1,081 | +11.3 % |
The median bill rose 39 % over the period while the number of policies fell 10 %. The largest step of the median between two snapshots was 14 %, below the cap, because about half of the policies were already at or near their full price and only change with FEMA's general rate updates.
In August 2023, FEMA reported that 38 % of single-family policyholders already paid a risk-based premium (FEMA single-family cost page). On July 31, 2026, the share of policies at or above their full-risk premium in the policy file was 53 %, and the other 47 % still had increases to come.
Where the increases have furthest to run
The share still capped differs a lot between states. Among states with at least 1,000 policies, it was highest in West Virginia (73 %), Hawaii (65 %), Mississippi (63 %), where most policyholders will keep seeing yearly increases. It was lowest in Alaska (11 %), District of Columbia (12 %), Utah (20 %), where most bills have already caught up.
Share still capped in your state
Single-family flood policies in West Virginia
$1,342
| Median full-risk price, same policies | $2,894 |
| Still below their full-risk price | 73 % |
| Median paid in August 2023 | $972 |
| Gap left from the bill entered | 5 renewals at 18 % |
Two ways to lose the cap
A lapse is the first. A renewal paid 30 days or more after the expiration date ends the policy; a new application is required and, under the manual, the new policy "will be rated based on the full-risk premium". FEMA prints the warning on renewal notices: "If your policy lapses, you will lose the Annual Increase Cap Discount and your premium will be higher." Moving to a private policy and then coming back counts as a break in federal coverage too.
A sale is the second risk, but not an automatic one. The seller can assign the policy to the buyer, who may keep the same discounted premium; the cap is then recomputed on the buyer's own information. A buyer who will not live in the house moves to the 25 % track. The guide to buying in a flood zone details the routes, and the five-year calculator adds up what the remaining increases cost.