Flood Insurance can be confusing especially has often as the rules change. Your rate might go from $500 a year to $2500 a year with not much explanation.
Today we hope to eliminate some of that confusion for you.
Before we get into that I want to tell you a story about a property owner in Marion Illinois.
This property owner had 4 investment properties that were all in the preferred flood zone also known as flood zone x.
The premium on the first 3 properties was $790 for each property and the 4th property was $2690 a year.
Holy cow that is a difference
So why such a big difference in premium?
In order to understand the difference in premium we must understand what the National Flood Insurance Program defines residential and non residential properties as being.
So what about those properties that are not?
Well different rating models could come into play which would explain the difference for the property owner we discussed.
If you are an investor or commercial property owner its important to understand these things. They could have a major impact on your profitability.
So is there any way around these higher premiums?
Well there are many options in the private flood insurance market that look at these risks differently.
They may not charge you differently if it is being used for residential or non residential purposes.
So when purchasing a property you want to look at how this property is used now and how it will be used in the future.
So if you have further questions on how to understand residential and non residential flood insurance make sure to visit our website.
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.