True or False: Insurance companies set their own rates for flood insurance under the NFIP.

Under the National Flood Insurance Program (NFIP), insurance rates for flood insurance are not set by individual insurance companies. Instead, they are established by the NFIP, which is managed by the Federal Emergency Management Agency (FEMA). The NFIP is an essential program designed to provide flood insurance to property owners, renters, and businesses throughout the United States, especially in flood-prone areas.

The rates are determined based on several factors, including the flood risk associated with each property, defined by flood zone classifications and additional considerations like the property's elevation and compliance with floodplain management regulations. This centralized rate-setting approach ensures a consistent and equitable pricing structure for flood insurance across all participating communities, regardless of individual state regulations or insurance company policies.

This framework helps promote community resilience and encourages local governments to adopt and enforce sound floodplain management practices, which can ultimately lower the overall risk of flooding and damage in vulnerable areas.