10 Things to Know About Flood Insurance

May 23, 2016
  1. A large percentage of agents’ errors and omissions claims arise from failure to offer flood coverage. By offering flood coverage at the point of the homeowner sale, in addition to offering protection to clients from devastating losses, agents are also helping to protect themselves from potential E&O claims. —Keith T. Brown, CEO of Aon National Flood Services Inc.
  2. The National Flood Insurance Program (NFIP) does not include coverage for finished basements and additional living expenses. While the NFIP policy does not cover personal contents in a basement, it does provide valuable coverage for footings, foundations, posts, pilings, piers or other foundation walls and anchorage systems required to support a building; stairways/staircases; furnace, hot water heaters, electrical junction, circuit breaker boxes electrical outlets and switches. —Keith T. Brown, CEO of Aon National Flood Services Inc.
  3. Innovative new private products can help a flood insurance policy act more like a homeowner’s policy, such as providing coverage for finished basements and additional living expenses. —Keith T. Brown, CEO of Aon National Flood Services Inc.
  4. Floods are the most common natural disaster in the U.S. From 2010 to 2014, the average NFIP flood claim amounted to nearly $42,000. Total flood insurance claims from 2005 to 2014 averaged more than $3.5 billion per year. —NFIP
  5. In the past five years, all 50 states have experienced floods or flash floods. –—NFIP
  6. A total of more than 6.6 million homes along both the Gulf and Atlantic coasts of the U.S. are at risk of storm surge damage. The total reconstruction cost value of these structures is estimated at nearly $1.5 trillion. —CoreLogic’s 2015 Storm Surge Report
  7. A 2015 poll found that 14 percent of U.S. homeowners had a flood insurance policy. —Insurance Information Institute
  8. The poll found the percentage of homeowners with flood insurance was highest in the South, at 21 percent. Eleven percent of homeowners in the Northeast had a flood policy, while 9 percent of homeowners in the West and 10 percent in the Midwest had a flood policy. —Insurance Information Institute
  9. NFIP has accumulated significant debt in recent years. As of 2015, NFIP owed the U.S. Treasury $23 billion. —U.S. Government Accountability Office
  10. Private flood insurance is becoming more mainstream every day. In 2013, the Gainesville, Fla.-based Flood Insurance Agency became one of the first agencies to offer a private standalone flood policy in Florida. The agency has since registered over 2,000 retail agents to market its Lloyd’s Private Flood program across the U.S. —Evan Hecht, CEO of Flood Insurance Agency

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