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Flood insurance is regulated by the Federal Emergency Management Agency (FEMA) who administers the rates and coverage as set by congress.  The premium rates charged to flood policy holders by insurance companies and agents should, therefore, be all the same.  The special rates charged for homes newly added into a SFHA should also be the same from agent to agent.  Insurance companies or agents can not discount the rate or surcharge the rate for their benefit. However, the calculation of accurate rates requires that your insurance agent input adequate and accurate information about your home, garage, and property. Because of the complexities involved in flood insurance, it is possible for an inexperienced agent to miscalculate a rate.

FEMA also publishes the Flood Manual used by agents and provides updates to the manual twice per year or when there has been a change due to regulatory decisions.  These updates affect how polices are rated and include rules and regulations that ultimately affect the consumer.  Even though an agent may have years of experience in the insurance industry they may not have experience with writing flood insurance policies.  If you are in the market for flood insurance – there are four simple questions you should ask your agent:

  1. How many flood policies do you write a year?  You should be looking for someone that writes flood insurance on a regular basis; monthly as opposed to just a few times year.  
  2. Do you attend any of the flood training classes available to agents or attend any of FEMA’s webinar classes?  Agents are only required to take a flood class once during the lifetime of their license.  However, FEMA makes important changes twice a year and it is vitally important that agents take the initiative to stay current on their education.  Agent errors ultimately affect you - the consumer. 
  3. Are you familiar with the Preferred Rate Policies?   FEMA provides flood insurance rating options to help reduce the financial burdens placed on property owners whose buildings were newly mapped into a flood area.  This rating option allows a reduced rate policy to be put into place for at least the first year.
  4. Besides attending the basic flood training, has any of your staff studied the last two flood reform acts that congress passed?  In 2012 Congress passed the Biggert- Waters Reform Act which originally called for the elimination of subsidized rates and grandfathering. In March of 2014, the Grimm-Waters Homeowners Affordability Act was passed as a revision to the original Reform.