Renewing Flood Insurance

Flood insurance policies do not renew automatically, so it is important to work with clients every year to ensure their coverage does not lapse.

Additionally, customers may be at higher risk of lapsing in the first two years of being a policyholder, so pay particular attention to new clients in your portfolio.

It’s important to let clients know that just because they haven’t experienced a flood doesn’t mean they never will. The Tiptons purchased flood insurance for more than 20 years before experiencing a catastrophic flood event. Continuous coverage gives your clients uninterrupted flood protection.

Talking points: “Why should I renew my policy?”

During policy renewals, discuss the following talking points with clients:

  • An afternoon storm, backed-up storm drains, or new construction in your area could bring inches of water into your home, causing thousands of dollars in damage to walls, floors, and furniture. And most homeowners insurance doesn’t cover flood damage.

  • If you allow your flood insurance policy to lapse once for more than 90 days, or during two or more annual renewal cycles for any number of days, you may be required to provide an Elevation Certificate and you may no longer be eligible for discounted flood insurance rates.

  • If you live in a high-risk area and have a loan from a federally regulated or insured lender, you are required to renew your flood insurance. When you purchase a home, you accept liability for any damage from fire, wind, hail, theft, or flooding that may occur while you live there. If you choose not to purchase a policy, your lender will force-place a policy at a much higher cost.

Renewal: Your client's annual flood insurance “checkup"

Clients will be notified of their upcoming policy renewal window by their insurance company. FEMA may also mail a renewal reminder letter during this time.

Every year after renewing, your clients will receive a copy of the Flood Insurance Claims Handbook, Summary of Coverage, and a loss history for their property – making renewal a crucial moment to help clients understand their specific flood insurance needs.

When renewing, take the time to review the following with your clients:

Make sure your clients understand their coverage and review if the current coverage is still adequate. This is also a good time to explain exclusions and limitations specific to NFIP flood insurance, as well as other coverages – including excess coverage – that may be available for their needs.