Glossary

Increased cost of compliance (ICC)

Flood policy coverage of up to $30,000, apart from the damage claim, toward elevating, relocating or demolishing a substantially damaged building.

Also called: ICC, ICC coverage, flood Coverage D

Increased cost of compliance coverage is part of the Standard Flood Insurance Policy (Coverage D). If a flood damages your building and your community declares it substantially damaged, or repetitively damaged where its ordinance provides for that, ICC pays up to $30,000 (FEMA, 2026) toward bringing the building into compliance with floodplain rules. Elevation is the most common choice, but relocation, demolition and, for some buildings, floodproofing also qualify. It is adjusted separately from the flood damage claim.

"Substantially damaged" generally means the cost to repair is 50% or more of the building's pre-damage market value. The determination is made by the community's building official or floodplain administrator, not by FEMA or your insurer, and communities can set a stricter standard.

Timing matters. In one published appeal decision, FEMA upheld an ICC denial because the owners demolished their building before the community issued its written determination, so get the letter before any work starts. ICC is the flood policy's counterpart to ordinance or law coverage coverage, which a homeowners policy typically offers for code upgrades after a covered loss; since a homeowners policy excludes flood, it will not pay floodplain-compliance costs after a flood. The guide on elevating a home and other flood mitigation covers what the work involves.

Last reviewed October 10, 2026

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Related terms

National Flood Insurance Program (NFIP) The federal program, run by FEMA since 1968, that makes flood insurance available to owners and renters in communities that adopt floodplain management rules. Ordinance or law coverage Coverage for the extra cost of repairing or rebuilding a damaged home to current building codes and zoning rules, which the dwelling limit does not pay. Building code upgrade Work local building rules require when a damaged home is repaired or rebuilt, beyond restoring what was there, such as updated wiring or wind bracing. Base flood elevation (BFE) The height, in feet above a standard reference level, that floodwater is expected to reach in a flood with a 1% chance of occurring in any year. Special flood hazard area (SFHA) The land FEMA maps as having at least a 1% chance of flooding in any year, where lenders must require flood insurance on federally backed mortgages. Constructive total loss A loss where the building is not wholly destroyed but repair would cost so much, or be so restricted by law, that it is treated as a total loss.

Related guides

Elevation certificates and your flood premium What a FEMA elevation certificate records, who must have one, whether it lowers an NFIP premium under Risk Rating 2.0, and how to find or order one. Excess flood insurance above NFIP limits Excess flood insurance is a private layer above the NFIP's $250,000 building limit. How it attaches, who needs it, what to ask and where gaps can remain. Elevating a home and other flood mitigation How elevation, flood openings, raised equipment, floodproofing and buyouts work, what each does to flood insurance premiums, and where the money comes from. How to file a flood insurance claim Notify your flood insurer in writing, photograph before you discard, and send a sworn proof of loss within 60 days. The steps, deadlines and appeal options. NFIP flood insurance explained How the National Flood Insurance Program works: who sells it, what it covers (up to $250,000 building, $100,000 contents), what it excludes, and how it pays. Ordinance or law coverage: paying to rebuild to code After a covered loss, building codes can raise the repair bill. Ordinance or law coverage pays that extra cost, 10% of Coverage A in the ISO HO-3 unless raised.

Related tools

Flood insurance coverage gap calculator See how much of your home and belongings a National Flood Insurance Program policy can cover, what is left over, and when a new policy would start.