Most private insurers - such as Liberty Mutual and Allianz - currently are used to cover high-value homes and provide coverage beyond the NFIP's limit, but companies are expanding into "first dollar" coverage, Yeates said. The American private flood insurance market grew by more than half last year to reach 15 percent of the total. That's why they're billions of dollars in debt with this program." "It doesn't work that way with the federal government. "You try to envision what losses are going to be and price it appropriately because you have to have the money in advance to pay out claims," she said. Lynne Yeates McChristian, a spokesperson for the Insurance Information Institute and a risk-management and insurance instructor at Florida State University, said the private market is more equipped to offer better, and also more inexpensive, flood insurance. "The NFIP is a great program because it provided a flood option to people who didn't have it, but what it should be is an insurer of last resort," Albert said. Their flood maps are out of date almost as soon as new ones are released, he said, and its not taking in even close to as much money as its giving out.Įxpansion of private insurers in the market is a "no-brainer," said Jim Albert, CEO of Neptune Flood, which was just named to the CNBC Upstart 100 list of promising, early stage start-ups. Climate change had made its problems far worse by increasing the frequency and magnitude of floods, Moore said, which the NFIP was not built to handle. It needs to be reauthorized by the federal government every five years and hits that mark next month. The NFIP has generally been successful over the years at its goal of expanding flood insurance availability, Moore said, but now, "The program is broken on just about every level." As a result, many consumers are unprepared if a disaster strikes. Any homeowner with a federally backed home mortgage is required to buy additional flood coverage if they are in a designated high-risk area, but it is optional for everyone else. The program creates flood maps to determine what homes around the country are at-risk for floods, it sets rules for building on the coast, and, perhaps most significantly, it requires flood insurance for anyone the government determines has at least a 1 percent chance of flooding in a given year and offers its own policies for sale. "Essentially, it's Obamacare for flooding decades before Obamacare was created for health insurance," said Robert Moore, a senior policy analyst with the Natural Resources Defense Council and expert in flooding in climate change. It's a government-run program that fills the void in standard homeowners' policies that may exclude storm surge and flooding that can cause catastrophic damage. The National Flood Insurance Program was established in 1968. Personal Loans for 670 Credit Score or Lower Personal Loans for 580 Credit Score or Lower You never know who you're actually getting your policy from and it could end up costing you more in the long run.Best Debt Consolidation Loans for Bad Credit I asked to see this law and she immediately backtracked and said it was a policy. She even lied and tried to tell me it was the law to require a letter from the lender in order to cancel an insurance policy. That is poor customer service in general if her supervisors let her get away with that since it is a recorded call. When she got tired of talking with me, she said, "Hello, hello," and pretended to not hear me and hung up after we had been talking without issue for 10 minutes. The "supervisor" from Insurox has very poor customer service skills. To rub salt on the wound, they sent me TWO notices to renew my policy since I called them again in September to cancel my policy. I've lost hundreds of dollars on paying for a policy that is not needed or wanted. They still will not cancel the policy or give a refund. They had the FEMA letter and notification from my lender. I even got my lender on a 3-way call with Insurox stating they they will not send them a letter and flood insurance is not needed on the house. I've been fighting with Insurox and Neptune ever since to get my policy cancelled and get a refund. Months went by and I got a renewal notice in September. They told me they also needed a letter from my lender, which my lender did not send because lenders don't send letters to third parties. I sent the FEMA determination that my house was not in a flood zone. I contacted Insurox to cancel my flood policy in May since that was the only company I knew of and had dealt with for the entirety of my policy. Every single review is 1-star and some have the exact same issue as me. Neptune is a new company and has ONLY 1-star reviews on the BBB website. They were selling me a policy from another insurer, Neptune Flood. I didn't know I wasn't actually purchasing from Insurox. They Will End Up Costing You More In The End.
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