On Property Insurance Claim Tips Blog

Policyholder Question: Buying Flood Insurance and What You Need to Know

Here is an insurance claim question that we recently answered as a contributing member of insurance claim experts for United Policyholders who advocates for property owners. 

Q. I have been offered a job in Wilmington, NC and would like to live in a nearby beach community such as Surf City, NC.  Other than USAA, What is the best insurance carrier for flood insurance? 

A. Before I answer your question, please allow me to give you some background on flood insurance as our public adjusting firm has seen significant changes over the years. Because of the high risk of flooding and the widespread damages that often result, the insurance actuarial folks could not manage or price this peril so as to set an affordable premium. Thus the private insurance industry was simply not agreeable to assuming the flood risk. Thus, flood losses were excluded in most all standard property insurance policies. In 1968, the National Flood Insurance Program (NFIP) was created by an act of Congress as the lack of this coverage was affecting the economy and commerce. In the beginning years, this program while providing flood coverage, was very poorly run and claim service was terrible. Probably not surprising given that the NFIP was headquartered in Washington, D. C. as it quickly became a typical Washington bureaucracy, unresponsive and extremely difficult to work with.

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Understanding Depreciation Estimates for Your Property Insurance Claim

When there is a storm event such as the flooding in the Pensacola, Destin, Gulf Breeze and the Ft. Walton Beach areas we always get questions about how depreciation works. As public adjusters, we deal with this type of situation all the time when we are managing a policyholder’s claim. Deprecation is figured in a number of ways depending on who is making the calculations. As an example; in the insurance adjusting field, the text book example is to come up with a percentage based on the age of an item and its full life expectancy. So if an item is one year old and the average life is 20 years the percent to be applied for deprecation is 5%.  If the cost of the item new is $5,000 then $250.00 in deprecation should be taken for each year of life. If an item is 5 years old and the life expectancy is 15 years then 33% would be reasonable.

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Earth Movement, Foundation Damage Caused by Panhandle Flooding, Is it Covered?

Property owners in the Pensacola, Destin, Gulf Breeze and the Ft. Walton Beach areas may be surprised to find that their flood claim for foundation damage is denied because the NFIP says the damage is caused by earth movement; even though the earth movement was caused by flood waters! Before I discuss this, let me remind any reader that each loss is fact specific to that property. You may have two homes or commercial buildings side-by-side in close proximity to each other and the loss conditions from the same insured event may vary.

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Panhandle Flood Victims Need to Understand the Nuances of Flood Insurance

For those who have National Flood Insurance, we encourage you to review and pay close attention to your flood policy’s terms and conditions. The policies issued by the National Flood Insurance Program (NFIP) are unique because they fall under a Federal Government program with its own rules and regulations. As an example, the NFIP policy requires you to file a proof-of-loss within 60 days of the flood event. In layman terms, you must have figured out your loss and arrived at a sum certain amount to put on a document called a “proof of loss” and have it submitted to the appropriate person handling your claim. Unless this time period (60 Days) is waived by an authorized official of FEMA/NFIP the claim may be denied in total for failure to comply with the policy terms and conditions.

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FEMA Flood Extension Gives Testament to the Complexity of Proof of Loss Filing

Since October of 2013 our office has been cranking out claim packages for all of our clients so they fully comply with the terms and conditions of their flood policies.  One of those tasks is the filing of the Proof of Loss, which to the layman can be as complex as building a house with no construction experience.  

For a third time, FEMA has extended the deadline for filing Superstorm Sandy NFIP flood policy claims, 6 months to October 29, 2014. This is allowing policyholders who have supplemental claims or who have had repairs delayed due to code issues or other situations to gather the proper documentation.

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Gaps in Flood Insurance and a Claim for Basement Damage

For any of our readers who have or are contemplating remodeling their basement, here is an excellent article: The insurance risks of a basement man cave on the flood insurance gaps that exist if you are impacted by a flood event. Many of our Superstorm Sandy clients were shocked at how little coverage they had.Read More

Flood Legislation – Hope for Florida Property Insurance Policyholders

The House finally came to its senses last week and amended the 2012 Biggert-Waters act by scaling back flood insurance rate increases. This is not only good news for longtime homeowners in coastal areas but also will help revive the real estate market which made some homes too expensive due to substantial flood rate increases. Amongst the positive changes are that new homeowners will not have to immediately pay full rates and those long time residents holding existing policies will see more gradual increases.

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Flood Season & Helping the Policyholder with their Insurance Claim

Well it’s that time of year again.  No, not tax time.  All the flood adjusters from all over the country are attending the Federally-mandated annual flood certification training.  Over the course of several months, flood adjusters attend training workshops from coast to coast in order to receive certification to adjust flood claims.  No adjusters, even seasoned adjusters with years of experience, can adjust flood claims without having gone through the eight-hour long course each and every year in order to keep their flood certification status active.

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Flood Maps & Flood Insurance Hit Homeowners in Unexpected Ways

Flood Maps & Flood Insurance Hit Homeowners in Unexpected Ways
Today’s NPR article: Overhaul Of A FEMA Program Has Homeowners Calling Congress discusses the dire consequences new FEMA flood maps in conjunction with the newly implemented NFIP flood insurance rates is having. An issue not talked about is the requirement for communities who opted into the flood coverage program to follow the mitigation requirements established by FEMA/NFIP, which are strictly enforced. So new construction or substantially remodeled homes must comply with the newly revised flood map elevation height requirements.Read More

Flood Insurance Premiums Crisis? For Some a Full Lift May be an Option!

Those facing enormous rate hikes due to the recent NFIP overhaul and the lack of action in the federal government to make things right might consider lifting their home out of the flood zone. This article gives Facing Flood Insurance Crisis, You Could Lift Your Home from the Herald Tribune gives a very thorough review of the pro’s and con’s. Just keep in mind that building code enforcement can vary greatly from county to county so make sure you understand the building code compliance issues you will face if you embark on this course of action.   

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