Did your mortgage payment suddenly jump because of flood insurance you did not choose?
If so, your lender may have added force-placed flood insurance. This is one of the most expensive ways to carry flood coverage in Georgia.
In this article, you will learn what force-placed flood insurance is, why it costs more, how to replace it, and how to avoid it in the future.
Key Takeaways
If your property is in a Special Flood Hazard Area, such as Zone A, AE, V, or VE, and you have a federally backed mortgage, your lender requires flood insurance.
If you cancel your policy, miss a payment, let the policy lapse, or fail to provide proof of coverage, your lender can purchase flood insurance for you and charge the premium through your escrow account. This is called force-placed flood insurance or lender-placed flood insurance.
Force-placed flood insurance usually costs more because the lender is not shopping the market for the best option. The lender’s main goal is protecting its collateral.
The table below compares estimated annual force-placed flood insurance costs with private flood insurance rates from Georgia examples.
| Georgia Scenario | Force-Placed Estimate | Private Flood Insurance Rate | Estimated Annual Savings |
|---|---|---|---|
| North Georgia Mountains Zone AE | $400–$500/year | $100/year | $300–$400/year |
| Atlanta Zone AE | $600–$1,500/year | $300/year | $300–$1,200/year |
| Augusta Zone AE | $2,000–$5,000/year | $983/year | $1,000–$4,000/year |
| Savannah Coastal Zone AE | $3,000–$10,000/year | $1,041/year | $2,000–$9,000/year |
Start by getting a replacement flood insurance quote from private flood insurance carriers and, when appropriate, the NFIP.
Once you choose the replacement policy, bind coverage and request the declarations page. The declarations page proves your property has active flood insurance.
Send the declarations page to your mortgage company or loan servicer. Your lender should cancel the force-placed policy once it verifies that your replacement coverage meets its requirements.
If the force-placed premium was charged for a full year and you replace it early, you may be owed a refund for the unused premium.
Every one of these situations is fixable, but the faster you act, the less you may overpay.
There are three common ways Georgia homeowners end up with flood insurance coverage:
Private flood insurance is not always the best fit for every property, but it is often worth comparing before accepting lender-placed coverage.
Atlanta homeowners may see a dramatic difference between lender-placed flood insurance and private flood insurance.
That is why Atlanta homeowners should compare private flood insurance before accepting force-placed pricing.
Force-placed flood insurance is coverage your lender buys when you do not maintain required flood insurance or fail to provide proof of coverage.
Yes. You can remove force-placed flood insurance by purchasing your own qualifying flood insurance policy and sending proof of coverage to your lender.
Yes, you may receive a refund for the unused portion of the force-placed premium once your lender accepts your replacement coverage.
Many homeowners can replace force-placed flood insurance within 24–48 hours, depending on the property, carrier, and lender requirements.
Get a replacement quote, bind qualifying coverage, send proof to your lender, and request cancellation and refund of the force-placed policy.
If your lender has force-placed flood insurance on your Georgia property, you are likely paying more than necessary.
Now you know what force-placed flood insurance is, why it costs more, and how to replace it with a policy you control.
Your next step is to compare private flood insurance and NFIP options before continuing to pay for lender-placed coverage.
At Flood Insurance Guru, we help Georgia homeowners replace force-placed policies, compare available carriers, and send proof of coverage to lenders.