Will my NFIP or FEMA flood insurance pay out in Alabama?

It's a question we get from property owners in Birmingham, Tuscaloosa, Montgomery, Anniston, and Huntsville Alabama everyday.

What is a Flood?

We are specifically looking at what the National Flood Insurance Program or NFIP and how they define a flood. In regards to private flood insurance in Alabama they normally follow the same guidelines for defining what is considered a flood.

According the NFIP manual a flood is defined as a normal dry area that is inundated with water. It specifically states that it must be 2 acres or 2 parcels.

When taking out a flood insurance policy many property owners are confused about coverages. They also are confused about what the real risk of flooding exist.

 

 

Alabama Flooding

Growing up in Birmingham Alabama I can tell you the flood threat exists across Alabama. I remember watching the Vestavia bowling alley parking lot flood every time it rains. Flood damage in these areas was very common but many times not filed as a flood insurance claims.

This occurred many times as flash flooding in the area. Many areas like South Shades Creek or the Cahaba River could rise quickly.

After the 2019 flooding in Alabama some people on Lake Logan Martin were surprised to find out they didn't have flood insurance coverage for things like docks.

Whether you live in a low risk, moderate risk, or high risk flood zone it's important to know if your flood insurance policy will actually pay out on a claim.

It's important to know that generally most homeowners insurance policies will not cover flood.

So what exactly does FEMA or NFIP consider a parcel? According to the NFIP manual a parcel can be considered a roadway if it touches another property. This is important to understand if your home is the only building flooded. You want to make sure flood coverage you pay for would actually pay out.

So if coverages do pay out after a flood in Alabama what does flood insurance cover? It depends if you have a private flood insurance policy or an NFIP policy. Coverages provided can be different. Let's look at coverages that can be provided on an NFIP flood insurance policy.

  • Building coverage
  • Contents coverage (Personal property)

Depending on what coverages you select flood insurance costs could range and you could end up with affordable flood insurance. NFIP offers up to $250,000 on residential buildings and up to $100,000 on contents coverage.

Just because policies have a certain amount of coverage does not mean you would receive that on a flood insurance claim.

NFIP has an 80% rule when paying out claims. This means in order to have replacement cost on the building in Alabama you have to insure for 80% of replacement cost or get the max amount of building coverage through the National Flood Insurance Program. Many private flood insurance companies also have this guideline.

 

We have actually seen some private flood insurance companies require 90% of the replacement cost and not look at the max amount of coverage available.

Contents coverage on flood insurance policies work a little bit differently in Alabama. If doing a flood policy through the National Flood Insurance Program these are written on an actual cash value basis.

So what does this mean?

Think of it like this replacement-cost-depreciation = actual cash value.

So if you have some antiques in your home you could be disappointed come flood insurance claim time.

The good news is many private flood insurance companies do offer replacement cost on contents in Alabama. We recently saw this as a benefit with the hurricane claims in Alabama and the 2019 flood claims in East Alabama.

So you have a good understanding of what is a flood and flood insurance coverages.

Where can you buy flood insurance?

When purchasing flood insurance you can purchase it from any insurance agent in Alabama that offers flood insurance.

Are all flood insurance companies the same?

Will flood insurance rates be the same?

If you are purchasing flood insurance through the National Flood Insurance Program rates should be the same unless you have an elevation certificate or you are doing a policy assumption.

 

An elevation certificate can give you the most accurate rate with NFIP, but many times private flood insurance companies do not use them.

When selecting a flood insurance agent or agency you want to make sure you pick someone who offers NFIP and private flood insurance.

You also want to pick someone who is educated about what homeowners insurance policies will cover when it comes to flooding.

You also want to work with someone who can help you understand the true flood risk. We are not talking about just what your flood zone is but about understanding flood threats and the history of flooding in the area.

You also want someone who understands floodplain management ordinances and how it can impact your property.

What about the insurance company?

Are they all the same?

No they are not you want to look for a write your own carrier that administers flood insurance through FEMA.

What about after purchasing the flood insurance policy in Alabama?

Read over your flood insurance contract to make sure everything is correct including the flood insurance premium

Can you make a claim right away?

Generally NFIP has a 30-day waiting period on policies that are not for loan closings or newly mapped areas.

So maybe you have more questions about the flood insurance policy purchasing process?

Make sure to checkout our YouTube channel where we do daily flood education videos. You can also tune into our daily flood podcast where we provide up to date information on flood education and flood insurance.

You can also get a better understanding of your flood zone by visiting the flood mapping service

If you would like a flood insurance quote then click here.

Remember we have an educational background in flood mitigation. So we are here to help you understand your flood risks, flood insurance, and mitigating your property long term.

 

Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

 

Today we are taking a look at commercial flood insurance in Pelham Alabama. Flooding is the most expensive natural disaster in the United States every year. Pelham area is an area that has experienced major growth over the last twenty years. It is also an area that had some major flood problems in the 80's and 90's.

So today we are going to take a look at what to do when it comes to purchasing a commercial property in Pelham Alabama. Whether you are purchasing a true commercial building or an investment property it's important to understanding how to protect it when it comes to flooding and flood insurance. It is also important o know flooding is the leading natural disaster in the United States.

What Does Commercial Flood Insurance Cover?

 

  • Commercial building
  • Business Property
  • Loss of income (not by NFIP)

 

Commercial flood insurance also sometimes called business flood insurance can be tricky so its important to understand how things like flood claims and flood damage can impact flood insurance rates in Pelham Alabama. It is important to remember generally commercial property insurance will not cover flooding.

It's also important to understand how flood insurance coverages are different for a commercial properties.

So first of all is flood insurance required on properties in Pelham Alabama?

  • It depends on a few things like if you have a mortgage on the Pelham Alabama commercial property. If you have a mortgage and it is in the special flood hazard area then flood insurance normally will be required.

In Pelham Alabama the special flood hazard area is also going to be known as the 100 year flood zone. This will include flood zones like flood zone A and Flood zone AE.

The video below explains what the difference is here.

 

 

So you have found the right commercial property to buy?

What is next?

You want to make sure you have a copy of the flood loss history.

Due to privacy laws FEMA will only provide this to the property owner and it could take up to 30 days to get.

Once you have this you can better understand the flood risk on the property and the potential for flood damage in the future.

So now that you have that you have the flood history on the property you want to understand what flood insurance options are available.

Flood Insurance Options

There are two options available for flood insurance on commercial properties in Pelham Alabama.

Let's look at the National Flood Insurance Program first. This is also called the government flood insurance program or FEMA flood insurance. If entered correctly flood insurance rates should be the same no matter where you purchase the flood insurance from. 

National Flood Insurance Program Coverages

The following flood insurance coverage is available through the NFIP

  • Building coverage $500,000
  • Business property $500,000

It is important to understand that if your commercial property is a single family dwelling then it could fall under the the residential program with the National Flood Insurance Program. This means the following coverages could apply.

  • Building coverage $250,000
  • Contents coverage $100,000

 

Private Flood Insurance

The following flood coverages could apply to a commercial private flood insurance policy

  • Building coverage (not limited to $250,000 or $500,000)
  • Business property coverage ( not limited to $500,000)
  • Loss of use or loss of income (Business interruption coverage)

Understanding the difference in these two flood insurance options is very important. One reason is when you go to sell the property it could be a big difference.

For example many times policy assumptions are only available through NFIP. 

What is a policy assumption?

 

 

This can be very important if you decide to sell the property to someone who is doing an FHA loan on the property.

At the time this article is being written FHA does not allow private flood insurance.

Pricing and Mitigation

So is there a difference in pricing between NFIP and private flood insurance companies?

 

Yes we have seen where private flood insurance could be up to 60% less in many situations.

Currently private flood insurance companies use different technology to determine a flood risk score. Then this score is used to determine rates.

What about mitigation can it help with pricing?

Yes having things like flood vents on certain properties can help reduce the rates through NFIP. Some private flood insurance companies can use this in the rate for a flood insurance policy as well.

It is important to understand how these flood insurance coverages work when purchasing a property in Pelham Alabama.

So if you have more questions about commercial flood insurance policies in Pelham Alabama then click here.

You can also check out our daily flood education videos on our YouTube channel or even tune into our podcast.

Remember we have an educational background in flood mitigation so we can help you understand flood insurance, flood risks, and mitigating your property long term.

Contact Us

 

Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

 

 

Covid has been devastating across the world. Many businesses are out of business as a result of the pandemic hitting.

 

 

During a normal disaster many business owners might have been able to stay open. However because of lack of loss of use on business insurance policies many were forced to close.

The majority of these policies do exclude pandemics.

The courts in the United States and around the world are starting to fill with cases to dispute this coverage being denied.

A recent decision by a United Kingdom court could take a bad situation and turn it into an even more devastating situation.

According to Reuters Britains supreme court ruled many businesses should get coverage for Covid losses. So what does this mean?

So what does this mean?

It means insurance companies could have to pay endless claims on coverages that were not listed on the insurance policy.

These are some of the worlds largest insurance companies that will have to pay out these claims. Whats also important to understand is the reinsurers will have to cover these claims.

This means this could shake up the  e and s or surplus insurance market.

So how does this impact flood insurance?

Well reinsurers play a major role in the flood insurance market. They are a major player with the National Flood Insurance Program and private flood insurance.

Let's look at the role they play with the National Flood Insurance Program. According to FEMA the reinsurance program helps manage the future exposure of the National Flood Insurance Program on future flood risks.

Can you imagine if the U.S. government took all of this risk on their own. You can imagine events like hurricane Harvey could have bankrupt the country.

Now let's look at reinsurance on the private flood insurance side. Reinsurers are basically the back bone of almost every private flood insurance company. They decide what capacity they will take on regarding risks across the world.

When ever an insurance carrier loses a reinsurer they have to non renew certain risks and stop doing business in some areas. Being in the insurance industry for more than 12 years we have seen this happen multiple times.

These reinsurers have to have certain reserves to cover flood losses. So what if these Covid claims eat up a large portion of that reserve fund?

Well a few things could happen we could see flood insurance rates skyrocket, or we could even see flood insurance options dry up across the United States.

You could also see where some of these private flood insurance companies no longer meet the requirement of private flood insurance.

This means banks may not accept policies from these companies.

You combine that with coming off the busiest hurricane season in U.S. history and we could be on  course for a major shake up in the  flood insurance industry.

Even if the reserves do stay high enough the reinsurers are going to have to find a way to make up these losses.

After interest rates being as low as they have for as long as they have many insurance companies are already hurting on their investments.

So we could still start to see risk being declined and rates going up especially along the Gulf coast.

We will continue to monitor how this situation across the pond plays out and how it could impact the United States flood market.

If you want to look at your flood insurance options makes sure to click here.

If you want to learn more about flood education then make sure to check out our YouTube channel where we do daily flood education videos on flood insurance.

You can also check out our podcast.

Remember we have an educational background in flood mitigation which means we are here to help you understand your flood insurance, flood risk, and mitigating your property long term.

Contact Us

 

Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

 

My Post (19)-1

Sorry you need an elevation certificate for us to give you a flood insurance quote in Alabama.

Have you ever heard this when shopping for flood insurance in Alabama?

I know I have heard this almost everyday.

So is it true?

Well it could be and couldn't be.

We are going to look at some scenarios to give you an understanding of when it maybe required and when it may not.

Lets look at two things

  1. National Flood Insurance Program
  2. Private flood insurance

So does the National Flood Insurance Program require an elevation certificate in Alabama?

This could depend on a few things. First thing is the flood zone. If you are in the special flood hazard area also known as the 100 year flood zone then it could be required. We are talking about the following zones.

Flood zone A

Flood zone AE

 

Flood Zone V

 

So if you are in these zones and your property was built after the first flood map then generally an elevation certificate will be required.

What if it was built before the first flood map?

Well if the property has been substantially damaged or improved then an elevation certificate could be required.

Now let's answer the question you came to this blog for.

Does Alabama private flood insurance require elevation certificates?

This is a moving target question. Some private flood insurance carriers will require an elevation certificate if it is a post firm structure and in the special flood hazard area.

Some will the more negative your elevation is below the base flood elevation. Many times carriers use this as part of their flood score. So they may decline the risk but if you have an elevation certificate they may approve the risk.

Click here to order an elevation certificate

Thankfully the majority of the time private flood insurance carriers in Alabama will not require an elevation certificate.

Maybe you have been told all flood insurance is the same?

Then it maybe time to do a flood insurance review.

So if you have further questions about elevation certificates then click here.

You can also learn more about flood insurance by visiting our YouTube channel or tuning into our podcast.

Remember we have an educational background in flood mitigation. So we are here to help you understand your flood insurance, flood risk, and mitigating your property long term.

 

Contact Us

Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

 

 

Flooding in Alabama caused a lot of problems in 2019 and 2020. Many property owners were not aware of certain coverages that were available. As a result their mortgage may have been paid off but they could not replace or repair their home.

So today we want to answer a few questions on excess flood insurance in Alabama

  1. What is Alabama excess flood insurance
  2. When would excess coverage be needed

In understanding what Alabama excess flood insurance is let's think of a brick wall like the photo below.
My Post (17)-1Do you see how the bricks are stacked on top of each other? Well this is exactly what excess flood insurance in Alabama looks like.
You have the primary policy through the National Flood Insurance Program. If it is a residential building then you have coverage up to $250,000. If it is a commercial building you have coverage up to $500,000.

So what happens if this is not enough coverage? This is where excess flood insurance coverage in Alabama kicks in. You would purchase an additional policy through a private flood insurance company. When the coverages on the National Flood Insurance Program are exhausted then this excess policy would kick in.

It's important to know in order to generally do an excess policy you have to have an underlying policy with the National Flood Insurance Program for the max amount of coverage available.

It's also important to understand there would also be multiple deductibles in this situation. One for the National Flood Insurance Program policy and one for the excess policy.

It's also important to understand that different guidelines apply to excess policies and normal private flood insurance policies in Alabama.

So we have looked at what is excess flood insurance coverage in Alabama and when would you need it. Maybe you have further flood questions.

Make sure to check out our YouTube channel where we do daily flood education videos. You can also checkout our podcast.

Want to know what flood insurance options are available in Alabama? Click here.

Remember we have an educational background in flood mitigation which means we are here to help you understand your flood insurance, flood risk, and mitigating your property long term.

Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

Flood insurance in Alabama can be confusing. Many insurance agents in areas like Birmingham and Montgomery want nothing to do with it and others think people may not be in a flood zone.

Birmingham, Alabama Flood Insurance

After the 2019 Alabama flooding I can't tell you how many times I spoke to someone who said their insurance agent told them they were not in a flood zone.

Yikes!

Try explaining that to someone after they lost everything to a flood. Thats exactly what happened with people in Houston Texas and residents of Nathans Estates in Muscle Schoals Alabama.

So today we are going to look at 5 things that could cause flood insurance e and o claims to happen in Alabama.

  1. Building coverage
  2. Contents coverage
  3. Proper documentation
  4. Mistakes on application
  5. Cobra zones

 

Building Coverage

One of the leading causes of e and o claims on flood insurance can be building coverage. Many agents either don't offer building coverage or don't offer replacement cost on the building in Alabama.

It's important to understand these because a policy could default to actual cash value if the 80% rule is not followed.

 

The National Flood Insurance Program generally requires either the max coverage available or 80% of the replacement cost. So for example if the replacement cost of a building is $400,000 they would require $250,000 to be on the policy.

This is also the opportunity to have excess coverage which could cover the proper replacement cost.

 

Contents Coverage

The next area is contents coverage. We see many policies that do not have contents coverage. This ultimately is up to the customer but many times we see where it was never offered. 

Imagine losing all your personal belongings and not knowing you could have had coverage for it.

You would probably be pretty upset.

Recovering from not having contents coverage can be just as hard as recovering from not having building coverage.

Proper Documentation

Proper documentation on Alabama flood insurance policies is another area where we see alot of error and omission claims occur.

In many situations if the National Flood Insurance Program or FEMA does not receive the documentation they need they will drop coverage down.

I remember speaking with an insurance agent a few months ago. They had called us on this exact issue. The carrier had submitted some documentation to them but they did not see it in their insurance agency management system.

The customers coverage was lowered from $250,000 to $25,000. A claim occurred and to the agent and insureds surprise there was not enough coverage to cover the damages.

Some of the documentation that maybe needed is a signed application by the insured and the agent. Proof of payment, possibly an elevation certificate with color photos.

A big area we see mistakes everyday on is the application. So many times we will see agents mark a home has a basement not truly understanding how FEMA defines a basement.

 

If a property does not have all four sides below ground then FEMA may not consider it a basement. Things like this could cause problems during the claim process.

COBRA Zones

Lastly is writing coverage when it's not available. One big area this happens is Cobra zones and other protected areas.

 

Just a couple of months ago we where advising an agent in Savannah Georgia and Statesboro Georgia about these guidelines. They said well it let me write it. A couple of months later FEMA cancelled the policy for underwriting. We were able to help the client find coverage through the private flood insurance market but it was a difference of about $5000.

As you can see there are alot of things to pay attention to when setting up a flood insurance policy for a client. You want to make sure you have a good process of making sure all things are done.

Maybe you just don't want to offer flood insurance in Alabama and that is fine. We work with insurance agents across the country everyday because of our educational background in flood mitigation. Click here to learn more

If you want to learn more about flood insurance make sure to visit or YouTube channel where do daily flood education videos or our podcast.

Remember we have an educational background in flood mitigation so we are here to help you understand your flood insurance, flood risks, and mitigation your property long term.

 

Contact Us

 

Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

Technology has come along way over the last 10 to 15 years. Insurance has also started to transfer to more of a digital experience. 

You can tell by just seeing insurance commercials on tv today. 

It seems like auto and home insurance has become more of a commodity over the last 5 years.

Many people just want what coverage is required and to move on. They want it done as a quick as possible. Maybe save 15% in 15 minutes but what if 15 minutes could cost you 85% of what you own.

So is flood insurance the next drive thru purchase?

 

As I am sure everyone has had a drive thru experience. I feel like I have a bad one almost everyday when i go to get my afternoon diet coke from the arch.

 

 

Each time I visit I pay close attention to the drive thru experience. They now have multiple lines that merge to one line. They seem to be attempting to push through more traffic but are making more mistakes than ever.

Imagine if you bought flood insurance this way. Can you imagine having to get your policy changed 3 times or more?

Can you imagine purchasing a policy that has no contents coverage?

Can you imagine purchasing a policy that would only cover half the building?

Crazy right?

Well this is what we see happen everyday when someone purchases flood insurance online.

Treating your biggest asset to a drive thru experience may not be such a great idea.

After your home or business has flooded is not the time to find out you don't have the right coverage.

This is exactly what happened to a customer that came to us when they dealt with an online bank.

So if you are going to buy online or want that quick process at least make sure a few things are done.

  1. Signed application submitted
  2. Proof of payment submitted
  3. Confirm bank has a copy

So if you have questions about the flood insurance buying process then click here.

Remember you can also check out our YouTube channel where we do daily flood education videos.

We have an educational background in flood mitigation so we are here to help you understand flood insurance, flood risk, and mitigating your property.

Contact Us

Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

It's inauguration day in the United States. No matter who you vote for this is always a historic day in the United States.

Its the day power is transferred from one person to the next as you have one president going out and a new one coming in today. 2021 isn't just the changing of presidential power but also the changing of flood insurance.

Almost everyday we get asked when is the National Flood Insurance Program going to get out of the flood insurance game.

The answer could be never but some things have recently happened to transfer some of that power and will continue to through 2021.

In July of 2019 the FDIC ruled that banks could start accepting private flood insurance on top of the National Flood Insurance Program. This meant that many customers had an option that they did not before. However due to the National Flood Insurance Program and FEMA cancellation rules they could only change at renewal.

 

After this ruling there were still some dark areas if every loan accepted private flood insurance.

The two areas that came into question were FHA and VA loans because they are considered government loans. Sometimes getting a straight answer on VA guidelines can be difficult. Direct writers for VA loans say no but mortgage brokers for VA loans say yes many times.

 

However FHA is a little bit easier as they have clearly said no for right now. About 60 days ago FHA opened up the comment period to determine if they will accept private flood insurance.

Hopefully they will make a ruling on this in the first quarter of 2021 and allow private flood insurance to be accepted. However thats not the only change with this transfer of power happening. 

The National Flood Insurance Program is scheduled to release NFIP Risk Rating 2.0 in October of 2021.

 

If this does happen it could bring some sweeping changes to a very outdated flood program.

Some of these changes could include flood insurance rates being based on replacement cost, rates based on distance to the water, and possibly elevation certificates no longer being needed.

Currently if you live in a flood zone x or minimal risk zone it's the same rate across the country, However in the new system you mighty have a different rate in Houston Texas compared to Birmingham Alabama.

It has been said that this could cause flood insurance to be unaffordable in areas like Florida, Texas, Louisiana, and North Carolina where many flood prone properties exist.

Replacement cost on a property could also help determine rates. Currently this is only used in coastal flood zones also known as flood zone V.

 

Elevation certificates no longer being required could be huge. Currently in many situations you can't eve get a flood insurance quote through the National Flood Insurance Program without an elevation certificate.

This could also be a cost saver to property owners as elevation certificate pricing can range from $500 to $2000.

So with these changes happening in 2021 will the National Flood Insurance Program be leaving the flood insurance industry.

It looks like if this did happen it would not happen anytime soon. One reason is the National Flood Insurance Program does not even currently consider private flood insurance as continuous coverage. This is one reason why if you leave for a private policy and come back you may not have the same benefits.

The other concern is insurability for properties that have flooded multiple times. Historically it has been a challenge for these properties to get reasonable flood insurance in these areas.

As you can see there are a lot of changes that are happening with the National Flood Insurance Program and even private flood insurance. If you have further questions make sure to visit our YouTube channel where we do daily flood education videos.

Contact Us

 

Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

So the lake has been lowered does it mean flood insurance on Smith Lake will be lower?

Smith lake Alabama flood insurance

Flood insurance in the Smith Lake Alabama can have a wide range. Areas closer to the water may have higher rates and elevated properties might have cheaper rates on flood insurance in Alabama.

So what happens when the lake is lowered?

 

When it comes to flood insurance in Alabama or really any where rates are based on 12 months. This locks a rate in no matter what happens during that 12 months.

It's very common for lakes to be lowered in Alabama during the winter months so people can work on their docks.

year 1 photo

So will this lower flood insurance in Alabama?

Generally the only way this might lower the flood insurance is if the lowering is permanent. This could be something like draining a lake.

So if this is not going to help what can you do to lower flood insurance on Smith Lake?

One way is by verifying the flood zone. Almost every week we speak to someone on Smith lake that is listed in the wrong flood zone.

So let's say you are in a high risk flood zone like flood zone A and you should be in flood zone X.

What could the impacts be on flood insurance?

  1. Mandatory requirement removed
  2. Standard to preferred rate

If you are moved from a flood zone A to flood zone X then it is possible that your bank will no longer require flood insurance. This could really help with property value if it is no longer required.

The next thing that could help is going from a standard flood rate to a preferred rate. This could be the difference in $500 to $1000 a year.

In this situation you are generally going from a mandatory to a non mandatory flood zone.

So if you have further questions about how to lower flood insurance rates in Alabama then click here. Want to learn more about flood insurance and flood education then make sure to check out our YouTube channel where we do our daily flood education videos.

Remember we have an educational background in flood mitigation. This means we are here to help you understand flood insurance, flood risks, and mitigating your property long term.

Contact Us
Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com

Should you buy flood insurance online?

It's a question we get often. Covid 19 has changed a lot of this where everyone is shifting online.

 

 

However as the purchasing of insurance online has increased over the years it seems insurance coverage advising has taken a major hit.

One of the great benefits of walking into an insurance office was that you could have a professional agent advise you on the right coverages.

Lately it feels like insurance has become the next drive thru purchase for consumers.

People are concerned with how fast they can get it 

Can we advise customers online without a physical interaction?

Yes video is one form that is helping to change the purchase of insurance online. Using video through the purchase price does a couple of things.

  1. Personal connection
  2. Coverage recommendation

The development of video has done wonders for us. Whether someone is 2 miles away or 2000 miles away it has helped us develop a deeper relationship with prospects and customers.

Video has also allowed us to show prospects examples of when they may use or need a certain flood insurance coverage.

Can you imagine going online to purchase something with no advisement?

If you didn't know exactly what you were looking for you might pick the wrong thing.

We talk to flood insurance policy holders everyday who have done this. In fact many times they don't know if they have a National Flood Insurance Program policy or a private flood insurance policy.

Want to know the difference click here.

Buying flood insurance online doesn't have to be a bad thing. It just needs to be an advisement experience.

What do mean by that?

We mean that someone needs to help navigate you through the process of coverage selection and policy selection.

Let's look at coverage selection first. When someone comes to us after purchasing flood insurance online the first thing we look at is replacement cost of property.

 

The majority of the time they are underinsured for about 30-40%

Getting only 60-70% of your home rebuilt would do you much good. It would probably look like the picture below.

Now let's look at policy selection. When consumers are faced with the choice to choose between private flood insurance and the National Flood Insurance Program price is usually the driving factor.

However many times they are not shown the long term stability of those rates over a 5 year period. While the National Flood Insurance Program might have a higher rate they may have had more stable rates over a 5 year period.

As you see buying flood insurance online can be scary but it doesn't have to be. If you want to actually speak with someone or even get a video proposal on your flood insurance then click here.

Remember we have an educational background in flood mitigation. This means we are here to help you understand your flood insurance, flood risks, and mitigating your property long term.

If you want to learn more about flood insurance you can also check out our YouTube channel where we do daily flood education videos.

Contact Us

 

Chris Greene

Author

Chris Greene

President of The Flood Insurance Guru
M.S. in Emergency Management with a focus in Flood Mitigation
flood@communityfirstagency.com