Renewing Flood Insurance Policies
Flood insurance policies do not renew automatically, so it’s important to work with clients each year to ensure their coverage doesn’t lapse.
How to make the case for renewal
Just because a client hasn’t experienced a flood in the past year 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?”
- Floods can happen anytime, anywhere and to anyone. An afternoon storm, backed-up storm drains, or new construction in your area could bring inches of water into a home. This can cause thousands of dollars of damage. Yet most homeowners insurance doesn’t cover flood damage.
- Protect your investment — your lender expects you to. Clients are required to renew their flood insurance if they live in a high-risk area and have a loan from a federally regulated or insured lender.
- Lock in your current rate before an increase or flood map update. FEMA uses a phased approach to adjust rates so they are equitable, easier to understand and reflect each property’s unique flood risk.
Helpful information for renewing policies
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Reduce insurance costs
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Your clients has different options for reducing the cost of their flood insurance.
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Resources for writing a policy
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Quickly access important forms and documents, like the NFIP's flood insurance manual.
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Flood Map Updates
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Stay on top of flood map updates to help your clients lock in their current rate.
Frequently asked questions about policy renewals
Customers may be at higher risk of letting their flood insurance lapse in the first two years of being a policyholder. So, pay particular attention to the new clients in your portfolio.
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. These documents and information make renewal a crucial moment to help them understand their specific flood insurance needs.
It’s important to talk to your client about the hidden and changing flood risks over time. Changes occur due to runoff of surface waters from any source or new weather patterns that cause overflow water, wildfires and mudflows.
It’s also important to show the value of flood insurance to your clients if they are considering cancelling:
- Once they let the policy lapse, there is a 30-day waiting period required for a new flood insurance policy to become effective.
- They may be ineligible for future FEMA Disaster Assistance for Individuals and Households.
- If they live in a high-risk flood zone and have a federally backed loan, they are required to renew their flood insurance every year.
To help inform and reduce confusion, agents should review the Cancellation Reason Codes table in the Flood Insurance Manual to determine what qualifies as a cancellation, what documentation is required and eligibility for refunds.
Flood policies may be terminated mid-term or full-term and your client may be entitled to a full, partial, or no refund depending on their individual cancellation reason. Please refer to the NFIP Flood Insurance Manual- Section 6 for more information.