Realtor's and Flood Insurance

Help Protect Your Customer’s New Home
What to Know and Say About Flood Risk and Flood Insurance
Buying a new home can be confusing, which is why potential buyers rely on you, their Realtor,
to help them protect their financial investment. Flood risk and flood insurance are important
topics that homebuyers should consider early in the home buying process.
Understanding Flood Risks
What you should know.
• Floods can happen anywhere, at any time.
• A floodplain, or Special Flood Hazard Area, is land at a high risk of a major flood.
• This area is also called a 100-year flood zone. The term can be misleading. It
does not mean that a flood will occur only once every 100 years. Rather the area
has a 1 percent or greater chance of a major flood occurring in any given year.
• On average, properties in a Special Flood Hazard Area have a 1 in 4 chance
of experiencing a flood during the lifetime of a 30–year mortgage.
• You can access flood maps in a number of ways:
 – Contact a community official
 – Visit msc.fema.gov
 – Call 1-800-358-9616
Flood Insurance Basics
What you should know.
• FEMA’s National Flood Insurance Program enables homeowners, business
owners and renters in participating communities to purchase federally
backed flood insurance.
• Federally backed flood insurance is available to communities that adopt
and enforce floodplain management standards to reduce flood damage.
• Flood insurance is sold and serviced by approximately 90 private insurance
companies in more than 21,800 communities nationwide. No matter which
company is used, the price for a given level of coverage remains the same.
• Your customer can purchase flood insurance for both the building and its
contents. Flood insurance covers residential buildings up to $250,000 and
non-residential up to $500,000. Contents coverage can be purchased up
to $100,000 for residential buildings and $500,000 for non-residential.
• The typical 30-day waiting period for flood insurance coverage to become
effective is waived at the closing of a loan or if there has been a change
to the Flood Insurance Rate Map (FIRM).
• Flood insurance in excess of the $250,000 federal limit may be available
through other insurance companies.
• Residents in non-participating communities can purchase flood insurance
from private insurers.
What you should say.
> Anywhere it can rain, it can flood.
It is important to know your
property’s flood risk and your
insurance options.
> Most homeowners insurance
doesn’t cover floods.
> Damage from flooding affects
thousands of homes every year —
and it can be costly.
> Even if you aren’t required to
purchase flood insurance, it
could be a good option because
your home could still be at risk
for flooding.
What you should say.
> T alk to your insurance agent about
your flood insurance options and
how your flood insurance premium
might be different from the seller’s.
> Flood insurance usually is available
from the agent who sells your
homeowners policy.
> Visit FloodSmart.gov or call
1-800-427-2419 to find
an agent and learn how to
prepare for floods