We think the best approach to reducing the increasing number of repetitive loss properties is to make a property that suffers a flood loss a better risk than it was before it flooded.
Rather than settle the loss the old fashion way, by indemnifying the policyholder, putting them back in the same condition they were in prior to a loss….why not offer insurance coverage that allow repairs with FEMA approved flood damage resistant materials, even if those materials costs more than the materials that were damaged.
“Flood [damage]-resistant material” is defined by the NFIP as “any building product [material, component or system] capable of withstanding direct and prolonged contact with floodwaters without sustaining significant damage.” The term “prolonged contact” means at least 72 hours, and the term “significant damage” means any damage requiring more than cosmetic repair. “Cosmetic repair” includes cleaning, sanitizing, and resurfacing (e.g., sanding, repair of joints, repainting) of the material. The cost of cosmetic repair should also be less than the cost of replacement of affected materials and systems. In addition to these requirements, individual materials that are considered flood damage-resistant must not cause degradation of adjacent materials or the systems of which the material is a part.
For example: instead of replacing damaged traditional paperfaced drywall with the same paperfaced drywall, why not replace that drywall with Nonpaperfaced Dens® Brand gypsum panels, manufactured by Georgia-Pacific Gypsum, that incorporates fiberglass mats instead of paper facings and complys with FEMA’s "Flood Damage Resistant Materials Requirements", shown here: http://www.fema.gov/library/viewRecord.do?id=1580
Or why not replace wood flooring with porcelain tile that looks almost exactly the same? Or, use magnesium oxide waterproof (and fire resistant) wallboard?