Which of the following is false about increased costs of compliance coverage in a commercial flood policy?

The assertion that increased costs of compliance (ICC) coverage only applies to residential properties is incorrect. In fact, ICC coverage is intended to assist property owners—both residential and commercial—who need to comply with floodplain management requirements following a flood loss. This coverage is designed to help with the costs associated with bringing a property into compliance with current regulations, which can be significant.

This particular coverage becomes essential when properties are affected by flooding and subsequently must meet updated building codes or building standards as mandated by local authorities. The purpose of ICC coverage is to mitigate the financial burden incurred during the reconstruction or renovation process, ensuring that all eligible properties—not restricted to merely residential—can receive necessary assistance.

Thus, while some options may note the significance and scope of costs involved or the focus on structural improvements, the key point here is that ICC coverage isn't limited to residential properties, making the assertion in the second option false.