I recently interviewed Gregory Devone, President of Franklin Flood, LLC. He gave me some really helpful insight on flood insurance that I wanted to share with everyone. Hope you all enjoy.
1. What are some of the common misconceptions about flood insurance?
MYTH #1: My standard homeowners’ insurance will cover me if my house is damaged or destroyed in a flood.
FACT #1: Homeowners’ insurance does not cover flood damage. Flood insurance, purchased through your insurance agent or company, is the only guaranteed flood insurance available for your home.
MYTH #2: I live outside the floodplain, so I don’t need to buy flood insurance.
FACT #2: Almost one third of all flood claims are paid on structures outside identified floodplains. Floods can occur anywhere. An area that is near a levee or a dam is at risk of the levee or dam breaking. People who face even moderate flood risks should get insurance, which can be purchased for under $200 per year.
MYTH #3: Flood insurance is available only for homeowners.
FACT #3: Flood insurance is available to protect homes, condominiums and nonresidential buildings, including farm and commercial structures, whether in or out of the floodplain. Contents coverage also is available, so renters can receive coverage as well.
MYTH #4: If a flood is forecast in the near future, it’s too late for me to purchase insurance.
FACT #4: You can purchase flood insurance anytime. However, there is a 30-day waiting period after you have applied and paid the premium before the policy is in effect. The policy will not cover a loss in progress.
MYTH #5: The NFIP does not offer any type of coverage for basements.
FACT #5: Yes it does. The NFIP defines a basement as any area of a building with a floor that is below ground level on all sides. Basement coverage under an NFIP policy includes clean-up expenses and repair or replacement of items used to service homes and buildings. These can include elevators, furnaces, water heaters, air conditioners, utility connections, circuit breaker boxes, pumps and tanks used in solar energy systems. Flood insurance will not cover the contents of a finished basement and basement improvements such as finished walls, floors, and ceilings
2. Is the NFIP the only outlet for property owners needing primary flood coverage?
The government’s National Flood Insurance Program, or NFIP, is administered by FEMA, the Federal Emergency Management Agency. NFIP offers coverage that protects property owners from damage caused by rising water — a hazard not covered by a standard homeowner’s insurance policy.
Lloyd’s of London, the insurance giant based in the United Kingdom, also underwrites flood policies, through select agencies. The coverage is available in more than 30 states, including Alabama, New Jersey, Pennsylvania, Florida, Louisiana, South Carolina and Texas.
However, if you have a mortgage, there’s no guarantee that your lender will approve of flood insurance outside of the federal program.
3. What is the biggest change you have seen to the NFIP in the last few years?
Flood insurance reform established by Congress in 2012 has fundamentally transformed the original flood program. The changes have greatly affected premium rates, coverage’s, claims processing to name a few. The complex laws governing the NFIP have become so draconian that many insurance agents shy away from offering it.
4. Where do you see flood insurance heading in the next couple years?
I am convinced that a hybrid Federal/Private flood policy is on the horizon. This solution will lower the premium and spread the risk, helping to alleviate the Federal flood insurance debt.
5. How can brokers such as Central Penn Insurance Agency benefit customers by writing their flood insurance through Franklin Flood LLC?
Flood insurance is important, but In today’s fast paced world finding the time to research and shop for flood insurance can be difficult. Franklin takes pride in providing the best customer service experience in the business. Friendly licensed flood insurance specialists will answer your questions and get you an accurate, free, no obligation quote from a company you can trust. Franklin is pleased to offer both Federal and Private solutions to your flood insurance needs.