If you’re like me, you have not only been watching the health care votes in Congress but also been following H.R. 2874 and H.R. 2868. These are bills set to initiate the 21st Century Flood Reform Act since the National Flood Insurance Program (NFIP) expires on September 30th of this year.
Additionally, they are meant to address the looming debt being carried by the current program.
As we know, flood insurance can cover rain/water damage to a building, personal belongings or both. Current caps on coverage through the NFIP are $250,000 for building and $100,000 for personal belongings. Further coverage for off-site accommodations during repairs are not covered.
The Republican package on the table calls for a cap in risk premium of $10,000 and also ask for a five-year NFIP renewal whereas the Democrats want a $3000 cap and a 10-year length.
The main push for these bills is to give private insurers more presence in the flood insurance market. Although the changes do not address either the recent complaints about the program or the NFIP’s debt. Both items need to be addressed quickly.
According to recent reports, we’re going to need flood insurance even more. Climate change will amplify storm surge and flooding. Additionally, the danger of increasing sea levels looms as well.
In states like New York and New Jersey, planners are trying to establish barriers and sand dunes to protect against property. In landlocked states like Michigan, Missouri, and Kentucky, rivers and, streams rise and crest now yearly.
One company is out ahead of the rest. HCI Group, a Florida company, offers flood coverage in Florida, but is looking to move into New Jersey, Maryland, California, North and South Carolina, Ohio, and Pennsylvania.
Their program would act as an endorsement to a regular homeowners policy and as a standalone coverage through their insurtech subsidiary TypTap. Their coverage does not have a 30 day waiting period and elevation certificate.
Their coverage offers up to $500,000 for building coverage and $250,000 for personal property coverage – double what the NFIP offers.
Best of all HCI is on board and ahead of most of the industry with their tech and application process. All the insured has to do is type in their address, answer three questions and pick an agent.
Since they have already proven themselves in Florida, which hosts the majority of the US Flood policies, they surely will not have a problem moving into other states. Either way, there is a lot of changes in the flood insurance on the horizon.
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