Private VS NFIP: Which Flood Insurance Should You Choose?

Last year, floods in the U.S. caused an estimated 60.7 billion dollar worth of damage to property and crops across the country.

To protect yourself financially from the severe damage caused by flooding, you will need flood insurance for your home, which can be purchased by either National Flood Insurance Program

Here’s a comparison of private and National Flood Insurance Program to help you select one for your home:

1.    Level of Coverage:

The coverage provided by National Flood Insurance Program for the structure of your home cannot exceed $250,000. This means that if your home repair costs you more than that, you will be paying out of your pocket. The NFIP’s flood insurance also excludes all items present below the lowest elevated floor or your basement. Private flood insurers on the other hand, can provide a much higher level of coverage. This can include the replacement costs on your personal property and other outbuilding structures of your home. Private insurers also cover additional living expense. 

2.    Waiting Period:

If you buy your flood insurance policy through the National Flood Insurance Program, it will take 30 days for the policy to be active and for the coverage to kick in. This waiting period can be cut short under certain conditions, if you opt for a private insurer.

For example, if you’ve purchased a new home whose closing is in less than 30 days, or your home is added to a Special Flood Hazard Area, you may be eligible for a reduced waiting period.

3.    Elevation Certificate Requirement:

To determine insurance premium rate or request for a Letter of Map Amendment, an elevation certificate is required under the National Flood Insurance Program.

You may purchase a flood insurance from both NFIP and a private insurer without an elevation certificate. However, the purchase will cost you much more than what you would pay for flood insurance with an elevation certificate under NFIP. With a private insurer, you might get a flood insurance without an elevation certificate at a lesser price than NFIP.

4.    HFIAA Surcharge:

HFIAA stands for Homeowner Flood Insurance Affordability Act. In April 2015, a surcharge of $25 dollars was added to the cost of flood insurance for primary residences under National Flood Insurance Program by FEMA. The surcharge for non-residential properties was up to $250. While it applies to all flood insurances under NFIP, you may have a chance of avoiding this surcharge through a private insurer.

Having flood insurance isn’t optional if you live in a flood prone area, such as Sarasota, Florida. Select a comprehensive flood insurance plan with Manatee Insurance! We will make sure your house is under complete fiscal protection from flooding. For quotes, visit our website or give us a call at (941)747-7283

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