Florida flood insurance

Why Florida homeowners need flood insurance

Despite how common floods are in Florida, flood damage won't be covered by a home insurance policy alone. And the cost of going uninsured can add up fast. According to the National Flood Insurance Program (NFIP), a single inch of floodwater can do up to $25,000 of damage. This is slightly lower than the average Florida flood insurance payout, which is about $28,900 per claim.

Florida is more likely to flood than any other state. Despite Florida's high flood risk, just 13 percent of homes in the state are insured under a flood policy. Homeowners without a flood insurance policy would be on the hook for flood-related expenses, which can be financially devastating. If you have a mortgage on your Florida home, your financial lender will more than likely require you to carry a flood policy in addition to your home insurance.

Flood insurance mandate for Citizens policyholders

Although the number of homes that have flood insurance in Florida is low compared to the state’s overall flood risk, this may soon change. In an effort to address the ongoing Florida homeowners insurance crisis, the state legislature passed Senate Bill 2-A in December of 2022. Among the many features of the bill is a new flood insurance requirement for Floridians insured with the state-backed insurer of last resort, Citizens (which currently holds over a million homeowners policies in the state).

The state is allowing for a roll-out approach regarding the flood insurance mandate. Unless you live in a special flood zone as defined by FEMA, the deadline to obtain flood insurance to be eligible for a Citizens homeowners policy varies depending on how much your home is worth, as demonstrated by the table below:

Keep in mind that if you live in a special flood zone hazard area as determined by the FEMA flood map, you must have had flood insurance by April 1, 2023 if you were applying for a new Citizens homeowners policy. Those in a special flood hazard zone already insured with Citizens were required to obtain flood coverage by July 1, 2023 (or by your next renewal if it fell after this date).

Additionally, if your Citizens homeowners policy excludes wind as a peril, you will not be required to obtain flood insurance.

Cost of flood insurance in Florida

Flood insurance rates in Florida will vary depending on how you purchased your policy. You can purchase flood insurance through the NFIP or through a private flood insurance provider. The average cost of flood insurance in Florida is $776 per year for an NFIP policy. Rates may be increasing across Florida, especially in higher risk areas where rates are projected to rise more than $20 monthly for over 4 percent of flood policyholders, based on Risk Rating 2.0 data. Private flood insurance in Florida could cost more, but private policies tend to offer broader, more customizable protection.

FEMA uses flood zones to determine flood risk in a given area. Different flood zone designations have different risk levels. Generally, zones B, C and X have a moderate-to-low risk of flooding, while zones that start with A or V have a higher risk. Subzones, like zone AE or zone V1, exist within the high-risk zones to give a more detailed view of the risk in that area. A location with a zone D designation means no mapping has been done in that area, and the flood risk is unknown. Generally, the higher the risk of flooding in your area, the more expensive your policy is likely to be.

Before you select a policy, check with your mortgage company to see what, if any, specific requirements exist for your flood insurance.

When to purchase flood insurance

If you want to be financially protected from a flood, you will need to be proactive. NFIP flood insurance policies have a 30-day waiting period before your coverage kicks in. The waiting period from a private insurer may be shorter. If a storm is coming your way, it’s already too late to protect your home with flood insurance; in addition to the waiting period, the NFIP and private flood insurance companies may put a moratorium in place, which halts the sale of new policies. A few exceptions to the 30-day waiting period exist, including if you are closing on a loan or if your home is newly mapped into a high-risk area. Still, for most homeowners, coverage will start 30 days after purchasing a flood policy.

How to save on Florida flood insurance

Obtaining an elevation certificate may help you secure a more affordable Florida flood insurance rate. The elevation certificate is an official document that shows a building's first floor height and overall compliance with FEMA ordinances. If your home's first floor height is higher than what FEMA had on record, you could receive a discount on your policy.

Another way to save some money on your flood insurance policy is to choose a higher deductible. The deductible is the amount of money you are financially responsible for after you file a covered claim. Essentially, it's the amount of money that is deducted from your flood insurance claim. Although choosing the maximum deductible can be tempting, make sure not to raise it too high. NFIP deductibles can reach the several thousand dollar range. As a rule of thumb, most insurance experts recommend keeping your deductible at a level you could comfortably afford to pay out of pocket.

How to purchase flood insurance in Florida

When you are ready to buy, you might want to get quotes for NFIP coverage as well as from some of the several private Florida flood insurance companies. If you choose to purchase insurance from the NFIP, you can purchase your flood insurance policy from the NFIP directly or an insurance company that helps facilitate NFIP policies. You can see if your home insurance company has a partnership with a private company to help facilitate the buying process. Or, you can reach out to a private provider directly.

The Insurance Information Institute (Triple-I) highlights the top 10 writers of private flood insurance in 2023 by market share:

Frequently asked questions