What Is an AE Flood Zone, and How Is It Rated by Insurance Companies?

What Is an AE Flood Zone, and How Is It Rated by Insurance Companies?

What Is an AE Flood Zone, and How Is It Rated by Insurance Companies?

The National Flood Insurance Program gives the designation AE to areas that have a 1 percent probability of flooding in an year, explains Insure.com. Additionally, such localities are considered to have a 26 percent chance of flooding in the course of a 30-year mortgage.

The National Flood Insurance Program assigns the letters B, C and X to areas with a low-to-moderate risk of flooding, according to Insure.com. Such regions are considered to have a less than 1 percent chance of flooding in a given year. This designation is also given to localities that are protected by levees and have less than 1 percent chance of flooding in an year. While available, flood insurance is typically not mandatory for such localities.

The National Flood Insurance Program gives the letter A to areas with a high risk of flooding, explains Insure.com. Depending on the locality, this designation may carry a suffix. For instance, AO refers to areas that are at risk from stream and river floods or to zones that have a 1 percent probability of shallow flooding up to depths of up to 3 feet. Flood insurance is mandatory in such areas. However, premiums may be capped in areas branded AR; this designation is given to zones where flood control systems such as dams are under construction or renovation.

The National Flood Insurance Program assigns V to coastal areas that are prone to flooding and gives a D designation to areas where the flood risk remains undetermined, notes Insure.com.