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Flood Insurance Rates Alabama |  Flood Insurance Alabama

Alabama Flooding map

Does my Alabama homeowner insurance cover flooding?

A typical Alabama homeowners’ policy is written through Farmers, State Farm, Allstate, and Progressive, for instance, excludes flooding as something that will be covered under their homeowner’s policy.

Flooding maps

In most cases, the only way to get flood coverage is by purchasing a stand-alone flood insurance policy. However, you should ask your homeowners agent if you can add an endorsement to your homeowner’s policy to cover flooding. Yet, don’t be too surprised if the answer is NO.

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Do I need flood insurance in Alabama?

It is important to have flood insurance coverage in Alabama because our beloved Cowboy State has seen a fair share of flooding, and there is likely more coming.

We believe that most homeowners think about Flood insurance in Alabama at some point, maybe before buying a home, or during the closing process.  However, many of us only think about it when a big storm is looming, or we have heard on the news that there is flooding forecasted or happening currently too close to our home.

Flood nerd Broken heartIf your home or business is in a flood zone, that is considered low flood risk area. Sadly, many homeowners decide to forgo purchasing coverage because they believe they are safe from flooding. Some real estate agents and some insurance agents may even say you don’t need it.

I ask you to consider the facts: 20-percent of all flooding events across our nation come in areas that are considered low risk. After our last few major storms (Hurricane Harvey), we saw flooding in these low-risk areas.  In 80 percent of these individuals, they had water in their home or building and didn’t have flood insurance coverage.

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Alabama Flood Zone Map

In Harris county, nearly 135,000 homes were damaged.  Three-fourths of these properties were considered low to moderate risk.

We hear often that people believe that the government will help, and this is true.  However, there are a few things that must align for you to get government assistance.

1 – The president of the United States must declare the flooding event a state of emergency.  If this doesn’t happen, then there won’t be assistance.

2 – The average amount of assistance that homeowners get after a flood, when they do not have flood coverage, is $5,000.  The average cost of damage to one’s property after a flood is $38,000+.  That $5K you get from the government?  It comes in the form of a loan and you will need to pay it back.  Are you willing to gamble away your financial future by forgoing flood insurance coverage?

https://www.bloomberg.com/graphics/2017-fema-faulty-flood-maps/
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Alabama Flood Map

Alabama flood map

One more note on these low-risk flood zone maps. Many of these maps are over 40-years old. If the area has been developed, then there is likely more concrete, creating a barrier for land that previously, might have absorbed the massive downpour.

Because of all these factors, it is difficult for property owners to know their true risk of flooding. FEMA admits that their flood maps only give an idea for part of the risk. Our recent storms are facts that it can rain anywhere within Alabama, and you should consider getting flood coverage, so you are not uninsured when you need it most.

FEMA flood zone maps often take years to go into effect after the terrain was studied, this gives the impression that the area is “more up to date” then it really is.

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The average cost for Alabama flood insurance in these Low-risk areas is $595 per year.

FEMA’s National Flood Insurance Program (NFIP) and all federally backed lenders rely on these Alabama flood insurance maps to assess risk, set premiums, and determine who is required to purchase flood insurance. Bad information about an areas flood risk can leave property owners under or uninsured.

 

How much is flood insurance in Alabama?

Alabama NFIP flood insurance.

There are many options available in Alabama regarding flood insurance, but they basically fall into two main categories. The Government Policy also called the NFIP or FEMA and the Private flood insurance market

The National Flood Insurance Program (NFIP), also known as FEMA, which is the government option for flood insurance.  The NFIP has enjoyed a 50-state monopoly on the flood insurance market.

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Not “private flood insurance” but NFIP Resellers

Progressive Flood Insurance

If you have Nationwide Flood Insurance, State Farm Flood Insurance, Progressive Flood Insurance, or any of the of the logos below then you are buying the NFIP flood policy that is just being resold through a government program. These companies are private companies, but their flood insurance is not. Here is a list of the 70 companies that resell the NFIP policy.

https://www.fema.gov/wyo_company

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Alabama private flood insurance market

 

Llloyds of London Flood Insurance ShopperThere are alternatives to the NFIP or government insurance.  It  is called Private flood insurance most notably Lloyds of London Flood insurance, however, there are other options available in Alabama . We shop all the options for your property in your region to ensure you are getting the best premium.  If you are ready to have us do the work for you, please click here.

Our shopping does include the NFIP because sometimes we find that with government subsidies you can get a much better premium.

Flood insurance quote in Alabama

Lloyds of London Flood Insurance Alabama Market

 

Alabama is fortunate to have many Lloyds of London flood insurance options. Although many Lloyds flood insurance companies will have you assume that there is only one option, nothing could be further from the truth.

Lloyds of London has a rich history and is attributed to have invented the very first modern insurance model. Unlike most of its competition, Lloyds of London is not really a company but rather a corporate body.  This structure works quite well since it has been around for over 330 years. Lloyds operates under multiple financial backers that all pool their capital to spread the risk.

Alabama Flood Zone Map

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I have two blog posts that take a deep dive into Lloyds of London and what they mean to Alabama ’s flood insurance market.  If you are interested, the links are below.

Lloyds of London Flood Insurance

Private Flood Insurance vs FEMA

Lloyds also insures the world for flood insurance, meaning they cover flooding events in India, Australia as well as much of Europe.  You see the “game” of insurance is to spread your risk since Lloyds is worldwide.

Lloyds of London Private Market Flood InsruanceMy joke here is that Lloyds is banking on Gods promise that he won’t flood the entire world again, …..so they won’t have to pay out the whole worlds flood claim.

How much does flood insurance cost in Alabama?

There are many factors that go into getting the cost of flood insurance for Alabama. If your home is in what is considered low-to-moderate risk, you can get a heavily subsidized policy though the government.

Alabama flood insurance low-to Moderate Risk rate and cost.
This is Flood Zone X, which is not lender required flood zone.

This is usually identified as an X-flood zone.  Then we would suggest the government Preferred Risk Policy (PRP) which is a subsidized policy and has set flood insurance coverage limits (see grid below):

$250K (Residental) /$500K (commercial) Building
NFIP Maximum Coverage Limits

Here a link if you want to really dig into this one. Be ready for an eye chart because every option is public record and should be standardized accost whoever writes these policies.

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The average cost for flood insurance in Alabama with the maximum set limits in these Low-risk flood zone areas is $405 – $700 per year.

https://www.fema.gov/media-library-data/1523307331106-4cf9726b2eb04c3471a3e9d37a58fa6a/09_prp_508_apr2018.pdf

A flood zone and SHFA rate maps
FEMA High-risk Rates

If your property is in higher-risk flood zone, it is usually identified with a Flood Zone AE. Your lender will require you to have flood insurance. The cost of flood insurance in Alabama depends on many factors that are unique to the structure. We are going to try to give you an idea for the most common homes we see in Alabama with a slab on grade foundation.

We will look at the Alabama cost of flood insurance for the NFIP maximum of $250,000 for the (building only) with NO CONTENTS and our recommended deductible of $5,000.

We will be rating this example on the NFIP, as well as on a few of our private flood insurance policies, specifically Lloyds flood insurance options in Alabama.

Cost of Flood Insurance in ALABAMA in high-risk flood zone AE

Our example is in Baldwin, but the premiums will be the same if in Gulf Shores, Orange Beach, Huntsville, Mobile, and many other Alabama flood ones.

In our example, the Base Flood Elevation (BFE is 530) and is a home that is built before 1973

Base Flood elevation Oregon

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NFIP option in Alabama Flood Zone AE

NFIP – Coverage of $250,000 building coverage (no Contents coverage) and $5,000 deductible

NFIP Annual premium in High-Risk flood zone is $7,127.00

This option is what we see if the property has had a flood loss before, and either doesn’t have an Elevation Certificate applied or the Elevation certificate showing that the lowest floor is 4 feet under the BFE for the area. You can use 10% of your coverage to cover other structures on your property

 

Alabama Private flood insurance – Lloyds of London Flood Insurance (option 1)

Coverage of $250,000 building coverage (no Contents coverage) and $5,000 deductible

Lloyds of London (option 1) Annual premium in High-Risk flood zone is $895.00

This option is great, and we are very happy when we can get this option. They can be a bit choosey about what risk they will accept and will not take anything that has had a flood loss. They do offer coverage for basements, about $2,000 for loss of use, $2,000 for other structures, but they can’t increase this coverage. They do not require an Elevation Certificate to rate.

Alabama Private flood insurance – Lloyds of London Flood Insurance (option 2)

Coverage of $250,000 building coverage (no Contents coverage) and $5,000 deductible

Lloyds of London (option 2)  Annual premium in High-Risk flood zone is $648.07

This option is great, and we are very happy when we can get this option for our clients as well. They seem to be writing almost all risks; however, they do not write any property that is in a designated floodway or has the depth of -4 under the BFE.  In our example, with our BFE being 5368, if the lowest floor is 5364, then they will not accept this risk.  They will not take anything that has had a flood loss. They do offer limited coverage for basements and do not require an Elevation Certificate to rate, and as a percentage of coverage for loss of use. If you want coverage for other structures, then that will need to be added.

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Private Flood insurance option (option 3) Not Lloyds

Coverage of $250,000 building coverage (no Contents coverage) and $5,000 deductible

Annual premium in High-Risk flood zone is $4,388.53

This option will take properties that have had one flood loss as long as it has been more than five years, and the payout was under $100,000 on the claim. Their coverage matches the NFIP.  They will write practically all risks, don’t need an elevation certificate to rate, and are a bit lower in premium than the NFIP.

Private Flood insurance –  Lloyds of London (option 4)

This option must be written on the Replacement Cost Value (RCV) of the building, otherwise there is a co-insurance penalty that kicks in. So, $250,000 might be a bit low in California, but to keep this going, let’s just use that for this option

Coverage of $250,000 (RCV) building coverage, No Contents and $5,000 deductible

Annual premium in High-Risk flood zone is $866.63(great price).

This options rating system is all over the board.  Sometimes we get a crazy great price, but other times the premium is way higher than the NFIP will consider taking a property that has had one flood loss before as long as it has been more than ten years and the payout was under $50,000 on the claim. Their preferred coverage is at replacement cost, which is a bit different from some of our other Lloyd’s flood options.  We usually reserve this one if the property doesn’t fit into any of our options above. We can adjust coverages to control premium. As mentioned before, this underwriters’ rates are all over the board.  It is worth shopping through to make sure we are getting you the best premium we can. They don’t need an elevation certificate to rate.

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Private Flood insurance –  Lloyds of London (option 5)

Coverage of $250,000 (RCV) building coverage, No Contents and $5,000 deductible.

Annual premium in High-Risk flood zone is $915.86

This option came out of the company that used to run the NFIP program, so the coverage almost exactly matches the NFIP coverage with two differences. They offer living expenses which will cover your cost, when you are displaced from your home during repairs (most Lloyds flood policies offer this).  They also offer swimming pool clean out, which is kind of unique so if you have a pool ask for this coverage.

Private Flood insurance –  Lloyds of London (option 6)

Coverage of $250,000 (RCV) building coverage. No Contents and $5,000 deductible.

Annual premium in High-Risk flood zone is $694.43

This options rating system is also all over the board. Sometimes we get a crazy low price; other times the premium is way higher than the NFIP. They will consider taking a property that has had one flood loss before as long as it has been more than ten years and the payout was under $25,000 on the claim. They have been rumored to give a low price the first year and then non renew following years or sometimes they jack the price way up so we will watch them. They have a slick system, and their underwriting is managed by a 3rd party, which also seems to be a glitch sometimes.

There are more options coming online every day, and we are working to be looking into every viable option.

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Alabama Flooding

Currently, Alabama has 54,419 NFIP policies in force to date with the total cost of $37,369,849.  That would make the average flood rate for Alabama $687. Of course, some will pay more, and some will pay less.

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Hello, Alabama!  Thanks for visiting our page for all your flood insurance needs.

Let’s start off with a group of areas including Autauga, Millbrook, Prattville, and Daphne, Alabama where the number of active flood policies total 826.  The premiums for these areas total $627,171 which allows the average flood rate to be $759.

When we look at Montgomery, Alabama, we find an average flood rate to be $759.  The number of active flood policies in Montgomery total 1,281 with $971,948 in written premium.

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Flooding in Baldwin County, Alabama

In Baldwin, Alabama, there are 11,136 active flood policies – the highest in the state!  Baldwin has an average flood rate of $566 which includes $6,299,796 in flood premiums.

Let’s look at Fairhope and Foley, Alabama where there are 506 active flood policies.  The premiums here total $268,839 which allows the average flood rate to be $531.

Gulf Shores, Alabama!  Hello!  Your beaches are clean with sparkling water!  You all have so much to do right on the beach!  This town is full of fun!  Glad you stopped by our page!  There are 7,584 in active flood policies with $4,071,181 in written premium!  The average flood rate in Gulf Shores is $537.

Right next to Gulf Shores is Orange Beach, Alabama!  Orange Beach also has gorgeous beaches, water, and lots to do! Orange Beach has an average flood rate of $345.  The number of active flood policies is 7,278 with $2,507,981 in total flood premiums.

Let’s look at a group of areas that include Anniston, Calhoun, and Jacksonville, Alabama where the average flood rate computes to $1,017!  The number of active flood policies add up to 407 with $413,965 in written premium.  Give us a call to check your flood rates!

Another group includes Oxford, Cherokee, and Elba, Alabama.  These areas have 448 active flood policies and $367,364 in flood premiums.  The average flood rate for these areas is $820.

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In Enterprise, Covington, Cullman, and Dothan, Alabama, the average flood rate is $646.  The premiums for these areas add up to $423,970 with 656 flood policies in effect.

Flood Nerds shop all options
FEMA FLood Insurance Rate Maps

The average flood rate in Dallas, Selma, and Elmore, Alabama is $874.  The premiums here add up to $485,254 with 555 active flood policies.

Flooding in Brewton Alabama

Let’s check out Brewton, Etowah, and Gadsden, Alabama where there are 327 flood policies active.  The premiums here total $467,885 which allows the average flood rate to be $1,431.

Moving on to Greene, Hale, and Houston, Alabama where the premiums add up to $197,421 which includes 273 active flood policies.  The average flood rate for these areas is $723.

$1,122 is the average flood rate for Scottsboro and Bessemer, Alabama.  There are 248 active flood policies with $278,211 in written premium.

Birmingham Alabama Flooding

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Hello Birmingham, Alabama!  You all have 724 flood policies in effect.  Birmingham has $1,026,641 in premiums which allows the average flood rate to be $1,418.  Give us a call Birmingham!

Looking at Homewood, Hoover, Lauderdale, Auburn, and Lee, Alabama, we find 897 active flood policies.  These areas have an average flood rate of $726 which includes $651,351 in flood premiums.

When we check out Jefferson, Leeds, Mountain Brook, Vestavia Hills, Phenix City, and Athens, Alabama, we find $792,177 in flood premiums.  The number of policies here add up to 851 which allows the average flood rate to be $931.

565 flood policies are active in Decatur, Alabama.  Decatur has an average flood rate of $716 which includes $404,704 in written premium.

Huntsville, Alabama!  You all have 3,251 flood policies that are active!  The premiums in Huntsville total $2,369,729 which causes the average flood rate to be $729.

The average flood rate in Limestone, Lowndes, and Owens Cross Roads, Alabama is $590.  The number of active flood policies total 329 with $194,265 in written premium.

$625,129 is the total written premium in Madison, Alabama.  The policies total 1,223 in Madison which allows the average flood rate to be $511.

Looking at Bayou La Batre and Chickasaw, Alabama, we find an average flood rate of $2,317.  The premiums here add up to $748,243 with 323 flood policies in effect. Give us a call to check your rates!

Dauphin, Alabama has 1,813 flood policies active with $1,502,647 in written premium.  The average flood rate in Dauphin is $829.

Flood Insurance Mobile, AL

Let flood nerds shop

In Mobile, Alabama, the average flood rate is $1,020.  The premiums in Mobile add up to $5,734,003 with 5,622 in active flood policies.

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414 flood policies are active in Saraland, Alabama.  The average flood rate in Saraland is $877 which includes $362,926 in written premium.

Let’s check out Satsuma, Montgomery, and Morgan, Alabama, where the average flood rate is $649.  The premiums here add up to $276,315 with 426 active flood policies.

The average flood rate rises to $839 when we look at Alabaster, Pelham, and Shelby, Alabama.  The number of active policies total 612 with $513,336 in written premium.

Another group of areas include Pell City, St. Clair, and Sylacauga, Alabama where the number of active policies total 525.  The premiums add up to $400,071 which allows the average flood rate to be $762.

Talladega and Northport, Alabama have an average flood rate of $697.  The number of active flood policies total 419 with $292,040 in written premium.

In Tuscaloosa, Alabama, the average flood rate is $753.  There are 774 active flood policies and $582,923 in flood premium.

Finally, let’s check out Walker, Wilcox, and Winston, Alabama where the average flood rate is $854.  The premiums total $188,671 with 221 active flood policies.

Thanks for checking out all the flood information on Alabama!!

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How to save money on Flood Insurance in Alabama VE flood zones

All homes that are ocean facing are custom built so with this special consideration our Lloyds of London VE flood zone and other Private Flood Insurance options for oceanfront properties take this into consideration with variable coverage options as well as significant savings below is a case study for a property we were shopping just last week.

Our example was in the Mobile, AL area and is in a VE flood zone map.

For the coverage of $250,000 with no contents and a $5,000 deductible the NFIP annual cost for flood insurance in a VE flood zone is $17,582.00. Ouch!

Since we are who we are and experts in Flood Insurance we will look at every property everyway possible to ensure that we are getting the best premium for our clients and WE often Do (smile wink)

We tried this same property on our Private flood options and were able to get the premium to under $2,500 and we have in some cases with similar properties gotten the annual premium to $600 this was a feather in our cap and made our clients very happy. Again all properties are unique in these VE flood zones but if we can find a private flood policy for you we guarantee it will be better then the NFIP option.

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Cost of flood insurance in Alabama

For decades, the NFIP has over-charged 50 percent of its policyholders and under-charged the other 50 percent, while it has racked up $42 billion in taxpayer-funded losses, equating to more than half of every claim paid by the NFIP since 1978.

About 30 percent of NFIP claims payments go to the same 3 percent of insured “repetitive loss” structures year after year. When you do the math, this means that the other 97 percent of their flood-exposed constituents could have paid in less and still netted larger claims payouts if they had better access to private flood insurance. In fact, a recent white paper by Milliman found that 90 percent of homes in Sandy-struck New York and New Jersey would see reduced flood insurance rates through private insurers.

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References
the following documents contain additional hydrologic data, flood photos, historic flood descriptions, floodplain delineations and other pertinent information, and should be considered supplemental to this flood warning plan:
https://bsa.nfipstat.fema.gov/reports/1011.htm#COT
https://www.fema.gov/average-claim-payments-date-loss
https://www.fema.gov/national-flood-insurance-program
https://www.fema.gov/media-library-data/1486576697135-ac6348fb2a3d98ceba33cf3f38422dbc/Claim_Loss_Counts_Sept2016.pdf
https://www.fema.gov/media-library-data/1458666638945-d752cb148ef1348b4b1c22acec66a0bd/Claim_loss_count2015.pdf
https://www.fema.gov/media-library-data/1393877884619-3091f75bf9d46a26f5beb7d423c34529/Total_Claim_Count_fy2013.pdf
https://www.weather.gov/safety/flood-states-al
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