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.


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.


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


Chris Greene

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

Its 2020 and everyone is using google for everything. Google knows more about us than we know about ourselves.


I remember sitting in a college e-commerce class when google first came out. NO one took it seriously, I know I didn't or I would have bought stock in it.

So what does google have to do with flood insurance?

As we mentioned google probably has more data than any other service out there.

Private flood insurance and the National Flood Insurance Program use different resources for determining flood insurance rates.

One of the benefits of private flood insurance is the advancement in technology they use in determining flood insurance rates.

While the National Flood Insurance Program or FEMA looks at a parcel many times they can not tell if a structure is elevated or not. So you may have a structure that sits 50 feet high but FEMA still thinks it is in the special flood hazard area. This is one reason why elevation certificates are required so many times.

So what is the private flood insurance approach to this? Private flood insurance uses many tools when mapping a risk. One thing they look at to determine the rating for a risk is location. Generally google earth is used to help determine this rate.

Google earth can be a great tool when locating a property. However if you have multiple structures on a property it may try to show the wrong structure. Let's look at an example of where this might happen. Imagine you have a lake house on Smith Lake in the Cullman or Jasper Alabama or maybe Lay Lake in Shelby, or Lake Logan Martin in the Pell City area. If you live on the lake you probably have a boat house as most lake home owners do.

Color image of earth planet in space

This could cause a major impact on your flood insurance if you are not careful. As the photo below shows this boat house is much closer to the water than the main house.

Screen Shot 2020-05-15 at 1.40.32 PM

So as you can imagine you will probably pay more for private flood insurance based on location.

So what exactly can you do to make sure this is accurate?

When getting a private flood insurance quote from The Flood Insurance Guru or any insurance agent ask for a picture of the map for accuracy. What you want to look at is where the red pin drop is at. It needs to be located on the structure that you will be insuring.


We recently saw where it was a difference of almost $1200 a year for the property owner.

As you can see you could be overcharged for flood insurance without even realizing it. Imagine if this error occurred for multiple years that could be a lot of money out of your pocket.

So can you get some of this premium back?

Maybe or maybe not

It depends on the private flood insurance company that you are dealing with, generally it can be difficult to get flood insurance refunds on prior policies.

So maybe you think you are being over charged or want to verify that your flood insurance is accurate then make sure to click here for us to verify it for you.

You can also visit our website or YouTube channel where we do daily flood education videos.


Start My Flood Insurance Quote



Chris Greene


Chris Greene

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