3 Common Misconceptions Your Clients Likely Have About Flood Insurance

Don’t let rumors and myths drive your clients’ decisions away from your assistance and prevent them from seeking your services. It is helpful that you are in the know of the most common myths about flood insurance that many current or potential clients are likely to have.

1. They’ll Receive Flood Coverage Through Homeowners Insurance

Homeowners commonly believe that their standard homeowners insurance policy will cover flood damage. As you know, this isn’t true and can be a devastating realization for those who don’t understand their policies and where exclusions apply. 

Typically, people assume that if their property flooded, the damage would not be too significant and it would not cost them much. But in actuality, even just five inches of water can cause over $25,000 worth of damage.

Flood insurance is available to homeowners, renters, condos, and businesses, and the best way for them to learn more is to discuss their coverage needs with you. 

2. Only Those in Special Flood Hazard Areas Buy Flood Insurance 

Many people come to the conclusion on their own that they do not need to even consider flood insurance because they are not in a specified flood zone. If it rains in a community then it can also flood in a community. Just about anyone is qualified to purchase flood insurance and each community may have certain management criteria for its local ordinance. Be sure to clarify the truth to prospects. 

3. Flood Insurance is Unnecessary With FEMA Disaster Assistance 

A flood insurance policy responds to flood events that may not be severe enough to result in a Presidential disaster declaration. Before FEMA’s non-NFIP individual assistance becomes available, the flooding incident must be severe enough declared a federal disaster by the President. Federal disaster declarations are issued in less than 50 percent of flooding events. If a declaration is made, federal disaster assistance typically is in the form of a low-interest disaster loan, which must be repaid. Any grants that may be provided are not enough to cover all losses.

For instance, in many Hurricane Harvey cases, an average Individual Assistance grant from FEMA was $7,000, while the average flood claim was over $100,000. It is important that your clients know the difference between disaster assistance and proper flood insurance. The aid that FEMA disaster assistance provides is significantly less than people assume, and it is practically guaranteed to not be enough to cover all of the damage.

About AmSuisse

Formed in 2013, AmSuisse, Inc. has quickly distinguished itself as a wholesale operation that specializes in working very closely with our agents and broker partners to develop responsive, individualized service for each client. Our unparalleled writing support, industry-specific expertise, marketing support, responsive proposals and quotes, strong customer service, and strong relationships with our carrier partners have all helped us to provide the best possible coverage for our clients. To learn more about our available coverage, contact us today at (800) 485-0229 to speak with one of our representatives.