Our clients often ask us about Flood Insurance coverage and here are some of the questions.
Will my flood insurance policy provide Replacement Cost Value or Actual Cash Value? And what is the difference between the two?
Replacement Cost Value (RCV) is the amount it would cost to replace property using the same materials and construction. Actual Cash Value (ACV) is the replacement cost value at the time of the loss, less the value of its physical depreciation. Building items such as carpeting are always adjusted on an Actual Cash Value basis.
The NFIP Standard Flood Insurance Policy (SFIP) offers Replacement Cost Value for building coverage only under two forms, The Dwelling Form and the Residential Condominium Building Association Policy (RCBAP) Form. Contents coverage is always paid based on Actual Cash Value.
To be eligible for Replacement Cost Value under the Dwelling Form, certain conditions must be met. First, the building must be your primary residence, meaning you or your spouse live there at least 80 percent of the year. Second, it must be insured for at least 80 percent of its full Replacement Cost Value or the maximum amount of insurance available under the NFIP. The RCBAP Form always provides building coverage at replacement cost value; however, the form includes a coinsurance clause. This coinsurance clause requires that the building must be insured for at least 80 percent of its full replacement cost or a coinsurance penalty will be applied at the time of loss.
The NFIP also offers the General Property Form, but claims paid for both building and contents coverage are based solely on Actual Cash Value.
Who should I call with a flood claim?
To file a claim, you should call you insurance company and file the notice of loss.
How can I pay for my flood insurance policy?
The NFIP accepts personal checks, money orders, and credit cards, including: American Express, Discover Card®, Master Card®, or Visa®. Payment must be made for the full year's premium.
How will my flood insurance policy be renewed?
Unlike homeowners insurance, flood insurance does not renew automatically. Policyholders typically receive at least 1 renewal notice with payment instructions 45 to 60 days before the expiration date.
Are there additional fees beyond the Federal Policy Fee charged by the NFIP?
Yes. The NFIP only charges the Federal Policy Fee to help cover administrative costs incurred to carry out the program, which is included in the total flood insurance policy premium. Your premium also includes a fee for the Reserve Fund, which is required under the Biggert-Waters Flood Insurance Reform Act of 2012.
Protect your home, family, and property all year long from the debilitating threat of floods with proper insurance coverage from Midland Insurance Agency. Whether you live on theSouth Shore, Westerleigh, or Travis,Staten Island residents trust this property insurance company. Call (347) 702-7912 to quest a free quote on flood insurance today!