Focus on Flooding
Flood Insurance USA Specializes in the Right Protection for Every Property
According to FEMA, nearly half of all the counties in the United States have experienced a flood in the past five years, yet most property insurance policies do not cover flooding. As a result, there are a vast array of programs in place offering specialized coverage for various types of water- and flood-related damage, yet the majority of property owners of single family, multi-family, and commercial properties do not really understand what is really required of them in terms of this insurance or how to make sure they have the best and most financially sound coverage.
That, say Michael Freedman, founder and president of Flood Insurance Solutions/Flood Insurance USA, and Mischelle Parsnik, vice president at the same company, is the driving force behind their business today.
“All we do is flood insurance,” said Freedman. “It is more important than anything to specialize in just one thing, and for us, that is flood insurance and all matters related to flood insurance: from quotes, detailed Flood Risk Evaluations, and clients’ and potential clients’ options for insuring their properties depending on whether they qualify to be removed from high-risk flood zones.”
REI INK sat down with Freedman and Parsnik to discuss this complicated topic in detail and learned some very surprising facts about this widely misunderstood element of property protection.
Given how many areas of the country have experienced significant flooding in the past five years, does everyone need flood insurance?
You do need insurance against flooding, but that is not always the same thing as what most people think of as flood insurance. That is why one of our most important services is a flood risk evaluation report, which we provide free of charge, that lets a client know if their structure or buildings are qualified to be removed from a high-risk flood zone by FEMA. That specific work with FEMA, submitting a building to be removed from a high-risk flood zone, is called a LOMA, or letter of map amendment. When FEMA issues a LOMA, they are amending that portion of the flood map for that property and taking the structure out of a high-risk flood zone.
Why would a property owner want to remove their property from a high-risk flood zone?
There are a lot of benefits to being removed from a high-risk flood zone that are really significant for a property owner. Once the property is removed, flood insurance is no longer required by the lender, which means the client will no longer have to pay for flood insurance every year. For commercial property owners, say you save $10,000 each year on a building by getting it removed from the high-risk flood zone; that increases the value of that property by approximately $150,000 in terms that can be realized either by refinancing the property or selling it. For homeowners, this will help with selling their homes as many potential homeowners would prefer to own a home in the low-risk flood zone and not have to pay for flood insurance due to lender requirements.
For commercial property owners, we can provide the best flood coverage with the best premiums available in the private market due to our close working relationships with [industry] wholesalers. As for National Flood Insurance Program (NFIP) insurance, there are ways to reduce the premiums while maintaining the same coverage. We also have additional services, including providing elevation certificates throughout the country and flood zone determinations that we provide to lenders.
But is it safe to remove your property from a high-risk flood zone? What if there is a flood?
Knowing the answers to these questions is another great value that comes with our services. Commercial property owners usually get flood insurance included through their master property insurance program at no additional cost for any of their buildings in the low-risk flood zone. When a commercial structure is removed from the high-risk flood zone, it is still insured for flood under the master policy.
Commercial property owners who receive a LOMA are not at any additional risk because they are covered for flood under their master property insurance policy. This has helped us help our clients save tens of millions of dollars in unnecessary flood insurance premiums.
Can anyone apply to be removed from a high-risk flood zone?
Everyone should know their flood risk, which is why we provide the free evaluation as the initial step to working with us. Single-family homeowners, commercial property owners, multifamily owners and operators, hotels and resorts, property developers, real estate investment trusts (REITs), and many other parties can all benefit from leveraging this knowledge correctly. For example, we worked with one client with a portfolio of 83,000 SFR homes to remove about 5,000 of those properties from high-risk flood zones, a move that continues to save the company roughly $4 million a year on unnecessary insurance premiums, and by extension, can make the cost for residents less as well.
What is most important for every property owner to know is if they are required to have flood insurance and, if they are not in a high-risk flood zone, whether they are insuring their properties the best way possible. That is where that zero-cost flood risk review/evaluation comes in, and we provide that to anyone who reaches out to us for that service. Once they have that information, they can choose to work with us to obtain the right type of flood insurance, if necessary, or to get a LOMA on a property, or to just make sure they are getting the best deal possible on the flood insurance they do have, because that is our specialty. This is the only thing we do, and we are proud to say our expertise regarding NFIP and Private Insurance as well as client service is second-to-none.
Learn more about flood insurance, flood risk evaluation, LOMAs, and more at FloodInsuranceUSA.us.
