The One Flood Insurance Question You Forgot To Ask

n this episode of The Flood Guru Podcast we are discussing the one question most people forget to ask when switching flood insurance companies.

So you have decided to switch flood insurance carriers.

You have chosen the best coverage and the best deductible, now you just need to pick an effective date for the policy.

Most people would think just pick the expiration date right?

Wrong

Most people forget about what is called waiting periods.

Waiting Periods

What is a waiting period? This is the amount of time after the policy issue date before the policy can be effective.

We want to discuss the different waiting periods whether you are switching from the National Flood Insurance Program to the private market or if you are switching from the private market to the National Flood Insurance program.

Let's discuss the three waiting periods under the National Flood Insurance Program first.

1. Standard 30 day wait period
2. Loan closing no wait period
3. Newly mapped area 1 day wait period
   

In most situations the National Flood Insurance Program has a standard 30 day wait period. While this wait period applies to new policies can also be applied again if certain documentation like proof of residence and photos are not received within the requested time frame.

There are some exceptions to this 30 day wait period. If a policy is being set up for a loan closing then the 30 day wait period is waived and coverage is effective immediately. This applies to new loans and refinanced loans.

The next exception is the newly mapped revision. This means that a property has recently been changed from a one flood zone to another. In most situations this is when a property listed in a flood x (non-mandatory zone) has been moved to a 100 year flood zone. These are called flood zone A and AE (mandatory zones). The wait period on these policies is 1 day.

Now that we understand the wait periods for the National Flood Insurance Program let's look at private flood insurance.

Like the National Flood Insurance Program private flood insurance has a standard wait period. The wait period for most private flood insurance companies ranges from 5 to 15 days. Its important to read the policy jacket so you understand this wait period.

While private flood insurance does not offer a different wait period for newly mapped areas, they generally do waive the wait period for loan closings.

As you can see setting up a new flood policy with the right effective date is not as simple as you would think. Understanding these wait periods is important because if there is a gap in coverage it could force you to keep your National Flood Insurance Program policy for another year keep your flood premiums high.

This gap in coverage could also cause your mortgage company to force place coverage adding a significant amount to your yearly escrow account.

If you have further questions about these wait periods and what questions to ask when switching flood insurance companies make sure to visit our website. You can also check out our YouTube channel or Facebook page The Flood Insurance Guru where we do daily flood education videos.