With a hurricane approaching or right after one passes, we get a lot of questions about Florida flood insurance. While some Florida homeowner’s insurance offers a flood endorsement, most of the time it is a separate policy to have Florida flood insurance. Damage from floods happens quickly and causes significant damage even with just a small amount of water. Let’s take a look at some of the important information on Florida flood insurance, and at the end we will talk about how you can speak to a flood representative on our team and a quote for your property.
But I’m Not in a Flood Zone…
Florida is a low-lying state surrounded by water. Everyone is in a flood zone, especially here in Florida. If you are in a high-risk flood zone, your mortgage company will require you to have Florida flood insurance. If you are in a low-risk flood zone, while you aren’t required to have coverage, that doesn’t mean that you shouldn’t consider it. According to the National Flood Insurance Program’s Floodsmart website, 1 in 3 claims happen in the moderate to low-risk zones.
I had a friend that posted on Facebook after Hurricane Ian that they’d been in Florida for 4 decades, didn’t live in a flood zone, never had a direct hit from a hurricane, and never had flood insurance. Unfortunately, there was a retention pond behind their home that overflowed and had several inches of water come into the home. You don’t realize how quick water can cause significant damage, as the drywall soaks up the water, cabinets soak up water, etc. Her tip was to consider the additional coverage, as she wished that she had it when she needed it.
When you are in a low-risk flood zone, you can often get coverage between $400 to $700 per year. Some are higher, as it is different for each property, but Florida flood insurance is much more affordable than many realize in these lower risk areas.
Florida Flood Insurance – National Flood Insurance Program (NFIP)
We use several insurance carriers for Florida flood insurance coverage through the NFIP program. The most common is Wright Flood. NFIP is the major flood program offered to everyone. The ratings for this program were changed in October 2021, which is called Risk Rating 2.0. This is usually the most competitive rate if your home is in a high-risk flood zone. Also, when there are rating changes, there may be some benefits through this program like grandfathers rates or glide paths that slowly adjust your rate to the new rating.
There are some limitations of this coverage as well. The maximum coverage for the building is $250,000 and $100,000 for contents coverage. Since this is the maximum available, most mortgage companies will accept these limits, even if your homes replacement cost is higher. Then, you can purchase additional coverage as excess flood insurance if you choose.
Flood Risk Rating 2.0
Flood 2.0 is a new rating system for NFIP flood insurance. This started for new policies in October 2021 and renewals in April 2022. Instead of rating just for the zone that a property is in, this rating system takes other factors into consideration like:
- Distance to water
- Type of water (River, lake, pond, gulf, etc.)
- Prior flood history for the property
This gives each specific property a more accurate rate based on their specific risk. This helps some customers, and makes others have a higher rate, but it is supposed to be more accurate to what the actual risk truly is.
Florida Flood Insurance – Private Flood Insurance
Private flood insurance is different than the NFIP program and is offered by private market insurance carriers. Many of these companies don’t offer coverage in high risk zones, but may be very competitive in lower risk zones. Many of these companies offer higher limits then the NFIP program and they have other optional coverages that can add a lot of value to your policy. We often use Wright Flood or Neptune Flood for these private market flood policies. We have included a comparison sheet for one of Wright’s private options vs standard NFIP plans.
Florida Flood Insurance – Excess Flood Insurance
Excess flood allows you to get additional coverage over the NFIP limits when you choose to go with an NFIP policy. There are some underwriting restrictions so it may not be available for every property.
Can Anything Help My Flood Rates? Any Flood Discounts?
An elevation certificate can help Florida flood insurance rates significantly. While the flood zone is general for an area, and it does show individual properties, it doesn’t show the specific building info. Maybe the builder raised the foundation of your home. Maybe it’s on a natural hill that doesn’t show up on the flood maps. These are just some examples, but an elevation certificate will show the specific details of your home.
How high is the foundation? How high are the properties around it? If it’s a crawlspace foundation, what type of drainage features does it have? Etc. All of these types of factors will impact the risk for a specific property. Lower risk properties will get lower rates based on these factors. Without an elevation certificate, they are going to get the standard rates for the risk in the specific zone.
Elevation certificates may be on file with your city or county. This is especially likely if this is newer construction or if there has been significant modifications since its original construction. Some of the counties we’ve checked with started keeping these records between 1994 and 2004. If you want to new elevation certificate, a surveyor can usually provide one for you. Floods.org has some additional tips for getting elevation certificates.
Prior NFIP Flood Insurance
For people buying a house, if the seller had an NFIP policy in place, it can make a huge difference on your policy if you can get the policy details. We quoted a brand new policy for someone in Miami in a high risk zone, and it was about $5200 in a high-risk zone. However, they were able to get the seller’s policy details which they’d had for a long time. When we put in the prior policy info, the rate went down to about $940!
This may be due to several factors. The old policies required an elevation certificate, which as we discussed, that info can help the rating factors a lot. Also, on the Risk Rating 2.0 plan, there are some grandfathering of the rates, so it may have some grandfathered benefits on the property due to the previous policy.
As we have discussed, Florida flood insurance can be important to provide financial protection in the event of a flood in your home. These happen in high-risk areas, but also impacts many properties in moderate to low-risk areas. It is often less expensive than you may expect if you are in one of these lower risk areas.
If you have Florida flood insurance questions or want to see what it would cost for your home, give our Think Safe Insurance team a call at 813-425-1626. We are always happy to help, and want to make sure you understand your coverage or needs, whether you choose to purchase Florida flood insurance or not.