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Flood Insurance in Florida

As hurricanes and tropical storms increase in frequency and intensity, flood insurance can be more critical now than ever for residents of the Sunshine State. Unless you have a special (and rare) endorsement, your insurance policy homeowner does not cover flooding. To help you avoid a potentially devastating hit to your finances after a flood, Bankrate’s insurance editorial staff explores the importance of adequate coverage and guides you on your journey to finding Florida flood insurance quotes.

Key information about the flood rating

Information

  • More than 80 percent of flood policies in Florida may see a rate increase, with 12 percent seeing an increase of at least $10 per month, according to Risk Rating (RR) 2.0.

  • Between 73 and 90 percent of NFIP policies in Florida’s most popular cities are eligible for a raise, including Jacksonville, Miami, Tampa, Orlando and St. Petersburg.

  • RR 2.0 will dramatically increase premiums in Miami-Dade and Monroe counties.

Why do Florida homeowners need flood insurance?

Even though much of Florida is at risk of flood damage, only 13 percent of homes in the state have a flood insurance policy. But the National Flood Insurance Program (NFIP) notes that the median payout for flood damage claims in Florida is $28,900, which means homeowners without flood insurance risk expensive considerable. Flood insurance can help pay for the devastating damage that flooding can cause; even one inch of water can cause up to $25,000 in damage to a home.

Flood insurance is not part of standard homeowners insurance coverage. Many homeowners mistakenly think that flood damage will be covered by their home insurance policy, only to discover that they must pay for the damage out of pocket. Considering and possibly purchasing flood insurance before a flood occurs (most policies have a 30-day waiting period, with a few exceptions) could help protect your finances from the threat of costly repairs.

Flood Insurance Mandate for Citizens Policyholders

Historically, flood insurance acceptance in Florida is low compared to the state’s overall flood risk, but this may soon change. In an effort to address the ongoing Florida homeowners insurance crisis, the state legislature passed Senate Bill 2-A in December 2022. Among the bill’s many features is a new insurance requirement against flooding for Floridians insured with the latest resort’s state-backed insurer, Citizens (which currently has more than a million homeowners policies in the state).

The state is allowing an enforcement approach to the flood insurance mandate. Unless you live in a special flood zone as defined by FEMA, the deadline to obtain flood insurance to be eligible for a Citizens homeowners policy varies depending on the value of your home, as shown on the following table:

property value

Deadline to Get Flood Insurance

$600,000

January 1, 2024

$500,000

January 1, 2025

$400,000

January 1, 2026

All other property values

January 1, 2027

However, as mentioned, if you live in a special flood hazard area as determined by the FEMA flood map, you must now have a flood insurance policy if you are applying for a new Citizens homeowners policy. For those in a special flood hazard zone who are already insured with Citizens, you’ll need to get flood coverage by July 1, 2023 (or before your next renewal if it falls after this date).

Additionally, if your Citizens homeowners policy excludes wind as a hazard, you will not be required to obtain flood insurance.

Flood Insurance Cost in Florida

Flood insurance is available through the National Flood Insurance Program (NFIP), supported by the Federal Emergency Management Agency (FEMA) and various private insurers. NFIP insurance is available when you live in an area that supports floodplain management ordinances; currently, the NFIP has 23,000 communities. The NFIP reports that the average cost of flood insurance is $700 per year, but your rate will depend on your specific rating factors and can be much higher depending on the risk level of your area. Rates may be increasing in Florida, especially in higher-risk areas where rates are projected to increase more than $20 per month for more than 4 percent of flood policyholders, based on RR 2.0 data.

FEMA uses flood zones to determine the risk of flooding in a given area. Different flood zone designations have different levels of risk. Generally, zones B, C, and X are at moderate to low flood risk, while zones beginning with A or V are at higher risk. Subzones, such as zone AE or zone V1, exist within high-risk zones to provide a more detailed view of the risk in that area. A location with a D zone designation means that the area has not been mapped and the risk of flooding is unknown. In general, the higher the risk of flooding in your area, the more expensive your policy will be.

Before selecting a policy, check with your mortgage company to see what, if any, specific requirements exist for your flood insurance.

When to buy flood insurance

Most flood policies require a 30-day waiting period before your coverage takes effect, so it’s essential to plan ahead and purchase your coverage well in advance of a storm. If a storm is brewing, it’s too late to protect your home with flood insurance; In addition to the waiting period, the NFIP and private flood insurance companies can place a moratorium that stops the sale of new policies. There are some exceptions to the 30-day waiting period, including if you’re closing on a loan or if your home is newly assigned to a high-risk area. Still, for most homeowners, coverage will begin 30 days after purchasing a flood policy.

How to Buy Flood Insurance in Florida

When you’re ready to shop, you may want to get quotes for coverage from the NFIP, as well as from some of the several private flood insurance companies in Florida. If you choose to purchase NFIP insurance, you can purchase your flood insurance policy from NFIP Direct or from an insurance company that helps facilitate NFIP policies.

You can also contact private insurance companies that offer their own flood insurance. These policies will be underwritten by a private insurer, not the government. Private flood insurance rates are likely to vary from NFIP rates, and you may have different coverage options.

The Insurance Information Institute (Triple-I) highlights the top 10 private flood insurance issuers in 2022 by market share:

Range

Company Name

1.

American International Group (AIG)

2.

Zurich Insurance Group

3.

insurer inc.

4.

AXA

5.

Berkshire Hathaway Inc.

6.

switzerland re ltd.

7.

sompo

8.

mutual freedom

9.

Chubb

10

allstate corporation

Frequent questions

    • Could you. Homeowners insurance does not automatically cover flood damage, although some companies offer flood insurance as a backup. Most people will need to purchase a separate flood insurance policy if they want coverage for flood damage. If you have a mortgage or any other type of home loan and you are in a flood zone, you may be required to purchase flood insurance as a condition of your loan. Also, if you insure your home with Citizens, you may also need to purchase a flood policy. If you don’t have a mortgage, evaluating your flood risk may help you decide if a policy is right for you.

    • Landlords generally insure the building or property you rent, but this coverage does not protect your personal belongings. If you rent your home, contents-only flood insurance is a great solution to protect your belongings.

    • If you have a mortgage or home loan and your home is at risk of flood damage, you may need to purchase a flood insurance policy. Also, most people who insure their home through Citizens will eventually need to purchase a flood policy to be eligible for homeowners coverage. If you are not required to purchase flood insurance, the decision is a very personal one. But knowing that flooding can happen for many reasons, including hurricanes and heavy rain, and understanding the risk to your home can help you decide if a policy is right for you. If you’re not sure if you should buy flood insurance, it may help to talk to an agent.

    • We hear that FEMA provides support after a particularly strong storm, but this type of assistance is not guaranteed. To receive assistance from FEMA, you must live within a federally declared disaster area. Additionally, these funds often must be repaid within a certain time frame. By having your own flood insurance policy, you may be able to avoid red tape and get the support you need.

    • According to FEMA, a flood is a “general and temporary condition of partial or total inundation of 2 or more acres of normally dry land or 2 or more properties,” including your own property. Floods can be the result of inland or tidal overflow, surface water accumulation, landslides, or coastal collapse. Many homeowners use the word “flood” to describe any type of water accumulation in their home, including sewer backflow, but these types of damage are not true flooding.

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