How FEMA fixed it last time, and why that is not a plan

The same bulletin set out the remedy: “To decrease the chance of a coverage gap caused by the lapse in the National Flood Insurance Program authority, I am extending the 30-day grace period for receipt of the renewal payment after a policy's expiration date. Accordingly, any renewal payment due from a policyholder on or after October 1, 2025, shall now be due on the later of January 15, 2026, or application of the standard renewal terms of the Standard Flood Insurance Policy.” It applied to all NFIP policies, “whether issued by NFIP Direct or a Write Your Own company,” and its authority citation expressly reaches condominium associations through Article VIII.C of the RCBAP form.

Note the date it was issued: November 14 — six weeks into the lapse. The fix was retroactive. A board that needed certainty on October 5 did not have it. That is the reason to bind now rather than to count on a repeat.

The trap sitting underneath the renewal: the 80% test

While a board is looking at the policy anyway, look at the limit. The RCBAP carries a coinsurance penalty, at 44 C.F.R. Part 61, Appendix A(3), Article VII: “We will impose a penalty on loss payment unless the amount of insurance applicable to the damaged building is: At least 80 percent of its replacement cost” — or the maximum available under the NFIP, whichever is less.³

The penalty arithmetic, verbatim: “Divide the actual amount of insurance carried on the building by the required amount of insurance. Multiply the amount of loss, before application of the deductible, by the figure determined in C.1 above. Subtract the deductible from the figure determined in C.2 above.”

The policy's own worked example: a building worth $250,000 to replace, $200,000 of required insurance, $180,000 actually carried, a $150,000 loss and a $500 deductible pays $134,500. Being $20,000 light on limit costs roughly $15,000 on that claim.

This is the specific Oklahoma failure mode, and it has nothing to do with flooding. An association that set its RCBAP limit in 2019 and has renewed at the same limit every year since is very probably now below 80% of today's replacement cost, because construction costs moved and the limit did not. Every flood claim then gets cut pro rata and the gap becomes a special assessment. Re-valuing the building is a board task; the carrier will not do it for you.

One per-unit ceiling is worth knowing too. Article I.G: “no more than $250,000 may be paid in combined benefits for a single unit under the Dwelling Form and the RCBAP.”

A small change coming December 1

FEMA Bulletin W-26001, dated June 2, 2026, announces Flood Insurance Manual changes effective for policies dated December 1, 2026. The item that reaches condominium associations is a new conditional line on the declarations page for RCBAP policies: “Coinsurance penalty may apply. See your Policy Form for details.”⁴ A small change with a real effect — it puts the 80% test in front of a treasurer once a year instead of burying it in the policy form.

What a board can do before September 30

Check the RCBAP expiry date today. If it falls in the fourth quarter, call the agent this week.

Bind and pay early where the carrier will allow it. A renewal offer issued before the deadline is the thing that survives a lapse.

Warn any owner under contract. A closing that needs a new flood policy cannot get one during a lapse. That is a scheduling problem better discovered in September than in October.

Get a current replacement-cost figure while you are in the file. The 80% test is measured against today's cost, not the cost when the limit was set.

Oklahoma context

Oklahoma is not a coastal state and flood is frequently treated as somebody else's problem. Oklahoma City and Tulsa both carry substantial riverine and flash-flood exposure, and association buildings sit in mapped zones in both metros. The programme deadline applies in full regardless of how far the state is from the coast.

What to watch next

Congressional action before September 30, and if there is none, whether FEMA repeats the W-25005 grace-period mechanism — and how long it takes to do it.