The sea level around South Florida is steadily rising every year. Don’t be surprised if you see more floods happening in your area very soon. With a higher flood risk, your flood insurance premium will rise too, courtesy of the Risk Rating 2.0 update. However, this update for flood insurance in the Miami Dade area will also be critical to help deal with the damages caused by the flood.
Why Risk Rating 2.0 Was Necessary
For 50 years, the flood insurance premiums were determined by the mapping of all flood zones. The flood insurance premium was the same for all, regardless of how big or small risk a property posed. The new update has changed that. This update seeks to set the new premium rates as per the risk each property poses, and what all it covers.
In other terms, the new flood insurance premium will now be decided upon the following factors
- The size of the property
- The contents sought to be covered under insurance
- Its overall risk factors, including location, construction quality, proximity to a water source, and total cost to rebuild it
- The insurer from whom you buy your policy
The Risk Rating 2.0 insurance update is meant to empower insurance companies to help you survive the flood damages financially. Since these companies cover a greater flood risk than ever, they now must charge a higher premium to make coverage benefits available to all.
Despite the update, your flood insurance premium will be a fraction of the damages a single inch of flooding can cause. So, despite the premium increase, the new insurance plans will be a win-win deal for you.
Where to Buy Your Flood Insurance From
While it’s not mandatory to buy flood insurance in Florida, you must buy one for your own financial safety. If you are going to buy a house on a mortgage, your mortgage company will want you to buy flood insurance before they finance your new abode. You have the choice to buy the federal National Flood Insurance Program (NFIP) coverage or turn towards private insurers.
While NFIP was the first-ever flood insurance coverage of its kind, it has its limitations. You cannot get more than a fixed maximum coverage for your home or its contents in case of flood damage. The kick-in period is 30 days. You also don’t get any alternate accommodation package while your home is being repaired.
Private flood insurance policies fill all the gaps that NFIP leaves behind. This means you can get a much higher coverage limit from them and can avail flood insurance benefits much sooner than 30 days. You can also get compensation to live in an alternate accommodation while your home is being repaired.
The paperwork and disbursement are also faster with private flood insurance companies.
Since many private flood insurers are serving Miami Dade County, you will have to make your pick amongst them. You can choose the right insurer based upon:
- Their years of experience in the domain
- Their financial standing and claim disbursement process
- The flexibility they offer for their flood insurance plans
- Their approach in handling your claims from start to finish
According to a Forbes report, as many as 43% of Americans believed that flood insurance came as a part of their homeowners’ insurance, which is not true. Flood insurance is a standalone insurance policy that must be bought separately.
To this date, more than 75% of people don’t have a standalone flood insurance policy. Many of these people believe that their area has a very low flood risk, so insurance is not meant for them. What they don’t consider is that more than 20% of claims are filed by people living in low flood-risk areas every year. Every single inch of flooding can cause as much as $25,000 in losses, so a flood insurance policy worth a few hundred dollars is worth it.
Speak to your nearest flood insurance agency and get a free quote today.