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What Is an Increased Cost of Compliance Flood Claim?

Last updated October 19, 2026

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The short answer

How Icc Coverage Works

ICC coverage is part of a Standard Flood Insurance Policy from the NFIP. It activates when your community declares your home substantially damaged or a repetitive loss property. This means flood damage equals or exceeds a certain percentage of your home's market value, or you've had multiple flood claims.

The coverage provides money beyond what you get for direct flood damage. Its purpose is to help you elevate, relocate, demolish, or floodproof your home to meet current ordinances. This reduces future flood risk and is a one-time benefit for the life of the property.

Qualifying for an Icc Claim

Your home must be in a participating NFIP community, which includes most areas with flood risk. Your local floodplain manager must issue a declaration of substantial damage or repetitive loss. This official determination is the key trigger for ICC eligibility, not just the amount of your personal loss.

Your standard flood insurance claim must first be settled. The ICC claim is a separate, subsequent filing. You must also intend to rebuild or repair the home at its current site or a new, safer location. Policies vary, and your insurer decides what is covered.

  • Your community declares the property substantially damaged.
  • Your community classifies the home as a repetitive loss property.
  • You have a Standard Flood Insurance Policy in force at the time of loss.
  • You file and receive payment for a standard flood claim first.
  • You choose an approved mitigation method: elevate, relocate, demolish, or floodproof.
  • The work must bring the home into compliance with local floodplain management ordinances.

What Icc Funds Can Pay For

ICC funds specifically cover costs to mitigate future flood damage. Eligible expenses include engineering and design fees, permit costs, and construction for the approved method. For elevation, this means building a new foundation or raising the existing structure. For relocation, it covers moving the home to a new foundation on a safer lot.

The coverage has a maximum limit, which is separate from your building coverage limit. It will not pay for upgrades or improvements beyond what the local ordinance requires. For example, it covers the cost to elevate the home, but not for adding a new deck or finishing an attic during the same project.

The Icc Claims Process

Start by contacting your flood insurance company or agent after your community issues the substantial damage declaration. They will guide you through the specific forms and documentation needed. You will need to submit a detailed contractor's estimate for the proposed compliance work along with the ICC application.

An adjuster will review your submission. Once approved, funds are typically released in stages as work milestones are completed and verified. You must complete the mitigation work within a specified timeframe, usually a few years from the date of the flood loss, to receive the full benefit.

Next Steps After a Major Flood

Following a major flood, document all damage thoroughly with photos and videos. File your standard flood insurance claim promptly. Simultaneously, ask your local building department about a substantial damage inspection. Their finding is essential for any potential ICC claim.

Following a major flood, document all damage thoroughly with photos and videos. File your standard flood insurance claim promptly. Simultaneously, ask your local building department about a substantial damage inspection. Their finding is essential for any potential ICC claim. Secure emergency water extraction and structural drying to prevent further damage. This documentation also supports your overall claim. Consult with a qualified contractor experienced in elevation or floodproofing to understand compliance costs and options for your property.

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Frequently asked questions

What is the maximum ICC coverage amount?

The maximum ICC benefit is often $30,000. This is a separate limit from your policy's building coverage for direct damage. The actual amount you receive depends on the verified cost of the compliance work you choose, up to that cap. The specific limit is set by the National Flood Insurance Program and is subject to change.

Can I use ICC money to just repair my home?

No. ICC funds are only for bringing your home into compliance with floodplain rules to reduce future risk. You cannot use this money for general repairs. Those are covered, up to limits, by the building coverage portion of your standard flood claim.

Who decides if my home is substantially damaged?

Your local community's floodplain manager or building official makes this determination. They compare the estimated cost to repair the flood damage to the market value of your home before the flood. If repair costs meet or exceed a set percentage, it's declared substantially damaged.

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