What you need to know about Private Sector Flood Insurance
The availability of private sector flood insurance policies is exponentially increasing in many states, mainly because homeowners’ insurance provides no compensation for damage caused by floods.
Most of the residential flood policies can be purchased through the NFIP (National Flood Insurance Program), which is administered by the FEMA (Federal Emergency-Management Agency).
Generally, properties eligible for private flood insurance are residential structures comprising of one to four units, non-residential structures as well as other residential structures.
The coverage is unavailable for properties in CBRA areas, condominium units, non participating FEMA- communities and mobile homes as well.
Difference between private sector flood insurance and FEMA/ NFIP policy
Private sector flood insurance policy consists of the same cover as FEMA policy. The underwriters agree that under no circumstances would a loss be turned down under the former that would have otherwise been settled under FEMA/ NFIP Standard-Flood-Insurance-Policy Dwelling form. As a matter of fact, the two aforementioned policies usually make use of similar claims adjusters.
When should I apply?
Ideally, you should only apply for a private sector flood insurance policy when you have the will and capacity to purchase it.
A quote calculator that can give you accurate indications of the amount of premiums you’ll be required to pay is available on our website.
Is excess flood insurance available?
An excess private sector flood insurance policy allows you, the policyholder, to cover the value of a building when it’s in excess of the maximum-available limits of the policy.
Is it possible to revert to a national/ federal flood policy after purchasing a private flood insurance cover?
Yes. However, if the property had substantially low grandfathered rates under national flood coverage regulations, switching to a private flood insurance policy may result in loss of protection. When you eventually return to a private policy, you’ll be forced to pay higher premiums.
How can I establish the financial stability of a flood insurer?
We are favorably rated by Fitch, A.M as well as other companies that are responsible for rating the stability of insurance firms. This is sufficient proof of our stability and credibility.
Additionally, all the policies we sell are covered by guaranty funds of the states/ countries that we operate in.
Is there a waiting period for private sector flood insurance?
Yes, there is a waiting period. The average waiting period of federal policies is 30 days. However, in the case of private sector flood insurance, the waiting period is comparatively shorter.
In most insurance companies, flood insurance policies purchased as part of loan closings do not have any waiting period.
In some cases, insurance policies can mature within 48 hours. However, insurers can use their discretion to delay policies under particular circumstances-for instance-if a fierce hurricane is approaching land.
Advantages of private sector flood insurance at a glance
- Limits of coverage are generally higher than the limits provided by National Flood Insurance Programs in most of the countries across the world.
- Lower rates.
- Replacement cost loss compensation on every building loss.
- Little or absolutely no HIFAA surcharges.
- Replacement cost loss compensation on personal property.
- Elevation certificate not mandatory.
- Significant coverage in basements.
- The list of property not covered is usually shorter than National Flood Insurance Programs.
- Ordinance as well as law coverage.
- Favorable/ minimal deductibles.
- Enhanced coverage of other structures.
- Business income coverage is sometimes available for commercial policies.
- Coverage for detached garages and other structures as well.
Discover the Advantage of Private Sector Flood Insurance Today
Find out more by getting a quote for private sector flood insurance from WM Schwartz. You can call any of our offices. You can also visit our website.