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what you need to know about the flood insurance market

What You Need To Know About The Flood Insurance Market

As an insurance agent, you know better than anyone that risk mitigation is a crucial part of protecting your clients’ assets and livelihoods. Floods are one of the most common natural disasters that can cause severe property damage and financial losses. Unfortunately, many homeowners and businesses are underinsured or not insured at all for flood damage. To further add to the situation, some insurance companies are no longer offering coverage. Areas like Florida have a chaotic property insurance market right now. Prime Insurance Company can step in to write flood insurance and other specialty homeowners insurance coverage but before we get into that, let’s talk more about flood insurance and what’s going on.

What is Flood Insurance?

Flood insurance is a type of insurance that covers damage to your property and belongings caused by flooding. This can include damage caused by heavy rain, snowmelt, hurricanes, and other natural disasters. Many homeowners think they have floods covered on their current homeowners policy but they are typically not.

Why Your Clients Need Flood Insurance

Here are some reasons why someone might need flood insurance:

  1. Floods can happen anywhere, at any time, and to anyone. Even if you live in a low or moderate-risk area, you should still consider getting flood insurance.
  2. Floods can cause significant damage to your property and belongings. According to the Federal Emergency Management Agency (FEMA), just 1 inch of water in a 2,500-square-foot home can cause up to $25,000 in damage.
  3. Homeowners insurance policies typically do not cover flood damage. Even if you have a comprehensive homeowners policy, you may still need to purchase separate flood insurance to protect your home, property, and belongings.
  4. Flood insurance can provide additional peace of mind and financial protection in the event of a flood.
  5. Flood insurance is not just for homeowners. Business owners, renters, and landlords should also consider getting flood insurance to protect their property and assets.
  6. Some areas may require flood insurance if you live in a high-risk area.

Overall, flood insurance is an essential part of protecting your assets and livelihoods from the financial losses caused by flood damage. Even if you think you may not be at risk for flooding, it’s worth considering getting flood insurance to ensure that you are protected in the event of a natural disaster or other cause of flooding.

Misconceptions of Flood Insurance

One of the most common misconceptions about flood insurance is that it’s only necessary for those who live in high-risk flood zones. However, floods can happen anywhere, and even if you live in a low-risk area, you should still consider getting flood insurance.

Another misconception is that flood insurance is too expensive. The average cost of a policy depends on where you live and how much coverage you need. For example, if your home is in an area that’s prone to flooding but not at risk for other disasters like earthquakes or hurricanes, then it might be cheaper than one in a more hazardous area. The same goes for how much coverage you want: if there’s only one floor above ground level with no basement or crawl space below it, then there won’t be any additional costs associated with those areas being covered under the policy–but if those spaces are included in your plan’s scope of protection then they’ll add onto what it costs each month too!

The last misconception about flood insurance is that home insurance policies cover flood damage. As mentioned before, a typical homeowners policy doesn’t provide coverage for floods. It’s important to understand the policy and know what’s covered and what isn’t.

A State of the Market – Flood Insurance in Florida

Florida is one of the most flood-prone states in the US, making flood insurance an essential part of protecting your home, business, and assets. Flood insurance rates in Florida can vary widely depending on where you live, the type of coverage you need, and your home’s elevation.

In recent years, there have been some changes to Florida’s flood insurance market. In 2019, Florida passed legislation that allowed private insurers to offer flood insurance policies that are comparable to NFIP policies. This has given Florida homeowners more options when it comes to flood insurance coverage and has also helped to drive down the cost of policies.

Since Hurricane Ian hit Florida, the state has been struggling with the impact of flood damage and the state of flood insurance. The Daytona Beach News-Journal reported that FEMA has paid more than $3.6 billion to Florida residents in payouts related to Hurricane Ian and that there were more than 42,000 claims have been made by residents in seven Florida counties, including Volusia County where Ian struck as a tropical storm. Additionally, FEMA has provided $3.5 million in advance payments to policyholders who have started the claim process.

However, the state of flood insurance in Florida remains a concern. According to an article by Reuters, Florida has a flood problem and an insurance problem. They say that insurance is becoming more expensive and harder to get and that the average home premium in the state is $4,231 annually (about 3x the American mean). In some areas, flood insurance rates are set to soar, with homeowners in Collier County, Florida, paying an average of nearly $4,000 for flood insurance from FEMA.

Despite federal support, Florida is still grappling with the impact of Hurricane Ian and the state of flood insurance in the aftermath.

How To Get Flood Insurance

Prime Insurance Company offers flood insurance for any person or business in need of specialty coverage. As an insurance producer, you can work with Prime and connect us with your client to learn more about their insurance needs so we can offer a policy that actually covers them in the event of an accident, incident, claim, or lawsuit.

There are several reasons why someone should consider getting flood insurance from Prime Insurance Company.

  1. Prime Insurance Company specializes in property and casualty insurance for unique and specialty risks, making them a reliable and committed resource for producers and insureds.
  2. We are an excess and surplus (E&S) lines insurance company that writes business in all 50 states and is rated “A” (Excellent) by A.M. Best, which reflects our financial stability and strength.
  3. Prime follows a profitable business model that has inspired over 40 years of success and growth, which translates to a company that is committed to providing the best coverage and service to its clients.
  4. Prime has in-house underwriting, policy services, and risk management teams that collaborate to provide a broad range of coverage in specialty classes. They also have an expert in-house claims team that has handled over 70,000 claims to date and provides support to producers and insureds throughout the entire insurance process — from risk mitigation to claims handling.

Get a quote for specialty homeowners insurance and flood insurance today!

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