Why Is Private Flood Insurance Necessary in 2019

a flooded roadway

The federal government may soon require mortgage-lending institutions to accept both government-backed and private flood insurance, in large part because the federal government wants to increase access to flood insurance in flood-prone areas. Currently, a multibillion-dollar program run by the federal government is what provides most Americans with flood insurance.

Real estate investors prefer flood insurance that’s private because it’s more reliable than government-backed flood insurance, and in most cases private policies are more cost-effective than policies issued by the government. Those who own property in Florida, Louisiana, and Texas are most likely to benefit from an expanded private market, according to analysts from the Insurance Information Institute.

If you want to know more about why people are taking out flood insurance policies in 2019, read on!

  1. The Market for Private Flood Insurance Is Opening Up

Historically, private flood insurance policies have been rare in the U.S., in large part because of the potential for hefty losses on the insurer’s side. But with advancements in mapping and modeling systems being introduced frequently, the insurance industry has begun to look at flood insurance that’s private more favorably. And with more and more brokers and agencies offering flood insurance that has no government backing, costs will be competitive and likely favorable for consumers.

Real estate investors and owners of large commercial properties are the ones usually looking to take out flood insurance for a rental property, and this is mainly because the federal government’s coverage limit is $250,000, well under what it usually costs to repair an expensive property after a devastating flood.

  1. Policies Are Expansive

a flooded neighborhoodWhen shopping for any kind of insurance policy, prioritizing expansiveness is a good idea. Policies that offer a limited scope are typically ineffective and should be avoided. Look for policies that act as a wide net, protecting you from a wide variety of hazards. And remember that intense flooding doesn’t just affect the South. In fact, many real estate investors with holdings on the coasts purchase flood insurance; those investing in properties in New Jersey, for example, purchase flood insurance in NJ to protect their investments.

  1. Flood Insurance Provides Peace of Mind

Natural disasters like hurricanes and flash floods aren’t the only events that can cause significant water damage. There are other natural events, like rapid snowmelt, that can as well wreak havoc on an uninsured property. Those who hold flood insurance policies do not have to worry about natural disasters or destructive acts of Mother Nature. Instead, they rest easy knowing that if worst comes to worst, they’re protected.

Who’s a Top Provider of Private Flood Insurance

If you’ve been looking for an expansive private flood insurance policy, one that won’t let you down when you need it most, get in touch with us today. We here at Cobalt Steele know how important protection from devastating floods is, and that is why our policies are expansive, cost-effective, and applicable in more than 30 states.