University’s FEMA grants held hostage by flood insurance requirements

The University of Iowa won’t receive its FEMA grants until it purchases flood insurance for all its buildings—including some not on flood maps.

University’s FEMA grants held hostage by flood insurance requirements

Non-Profits & Charities


The University of Iowa is in a bind. Unless it purchases separate flood insurance policies for specific buildings—rather than a campus-wide policy—it may not receive the rest of its grant from FEMA to repair damage to the campus following a recent flood.

Still reeling from the 2008 flooding of the Iowa River, the school is requesting exemption from the FEMA regulation that would require the school to maintain separate flood insurance policies.

Backing the school, Iowa’s top insurance regulator made a plea to FEMA and President Barack Obama this week to grant the exemption.

Insurance Commissioner Nick Gerhart reportedly told the President and the federal agency that the university’s $250mn blanket policy with FM Global—as well as a separate $22mn policy through a federal program—would be enough to adequately protect against future flood damage.

He also added that having one insurance policy for the entire school was the most reasonable and cost-effective way for the University of Iowa to manage risk, as several of its buildings do not appear in FEMA flood maps.

At stake is not only the university’s funds, but a $270mn grant issued by FEMA following the 2008 flood, which destroyed several campus buildings. If the school doesn’t follow FEMA regulations and purchase separate insurance policies for each of its buildings—including those not in the flood plain—it may not receive its grant money.

FEMA has already delivered $125mn to the University of Iowa, which it is using to rebuild its performing arts theater, music school and art building. However, the remaining $145mn is in limbo while FEMA and the President review the school’s application for a waiver.

Spokesperson Michael Cappannari told the AP both President Obama and FEMA have still not made a decision, though he noted that federal rules typically require groups receive disaster assistance to maintain flood insurance in the amount of money they received.


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