Flood insurance administered by the National Flood Insurance Program (NFIP) is set to increase rates for new and renewal policies October 1. Flood insurance is offered to homeowners, renters and business owners to protect against damages not covered by standard homeowners or renters insurance in the event of a flood.
“Flooding is one of the top four disaster risks that we face here in Oklahoma and we must be prepared for when these events occur,” said Oklahoma Insurance Commissioner John D. Doak. “It is important to know the risks involved in floods and protect you and your family with a flood insurance policy.”
The rate increases are part of key provisions in the Flood Insurance Reform Act of 2012, passed by Congress in July 2012. The legislation extends NFIP until September 30, 2017 and includes phasing out subsidies on properties with repetitive losses, allowing coverage availability for multifamily properties and minimum deductibles for flood claims in addition to raising premium rates to reflect the actual flood risk.
“This is an opportunity to save on purchasing flood insurance as the severe weather season starts and before rates increase in the fall,” continued Doak. “Having this type of insurance is an excellent way to avoid paying thousands out of pocket in the unfortunate event of flooding in your home or business.”
Insurance companies work closely with Federal Emergency Management Agency (FEMA) and the NFIP to offer flood insurance to property owners and renters. Rates do not differ from company to company, but do depend on factors such as age, type of construction and the level of flood risk in your area. FEMA estimates the current average homeowner’s flood insurance premium to be approximately $500 a year, depending on deductible and the aforementioned factors. Flood insurance policies typically take 30 days from date of purchase to become effective.
Oklahoma consumers with questions about flood insurance can call the Oklahoma Insurance Department Consumer Hotline toll-free at (800) 522-0071 or visit http://www.ok.gov/oid/Consumers/Prepare_Yourself/Floodwaters.html.