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FEMA WYO Bulletin on Available Coverage for Cooperatives

The Federal Emergency Management Agency (FEMA) has issued a bulletin w-13032 relating to obtaining flood insurance coverage...
June 18, 2013

The Federal Emergency Management Agency (FEMA) has issued a bulletin w-13032 relating to obtaining flood insurance coverage. It addresses whether a Standard Flood Insurance Policy (SFIP) could be purchased solely in a shareholder’s name, which would provide building coverage to the shareholder instead of the cooperative itself.

This bulletin makes expressly clear how the National Flood Insurance Program (NFIP) treats cooperatives. As a result of documentation provided during the claims adjusting process for cooperative-owned property in New York following Superstorm Sandy, it takes into account and addresses unusual forms of cooperative ownership. FEMA/NFIP finally agrees that these still qualify as a cooperative, and they give guidance as to how and what parties are insured. While the example is specifically from New York, this is not the only place that these newer style of more complex cooperative arrangements arise. FEMA encourages insurance agents and the Write Your Own companies to review the underlying cooperative documents to determine how cooperative buildings are owned, as it may be that other cooperative arrangements exist that allow an individual to actually own the building, and thus be able to purchase building coverage.

It is important for PIA members to ask when applicable: Is the property: Multi-tenant rental property, or a condo, or a cooperative, or a land-grant trust – and what is the exact structure of ownership, i.e., who owns what?

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