In 2011 there were many business owners experienced a flood loss and to their surprise they were self-insured. If you own a building that is not located in a FLOOD ZONE, the rates are extremely affordable. I suggest that you discuss with your Insurance Advisor and obtain rates to determine if it is an affordable coverage for your investment and as always, feel free to contact me with any inquiries.
Jennifer Moffitt, CIC, CWCA
Almost 40% of small businesses never reopen their doors following a disaster because just a few inches of water can cause tens of thousands of dollars in damage. Over the past 5 years (2006-2010), the average commercial flood claim has amounted to just over $85,000. Flood insurance is the best way to protect yourself from devastating financial loss. Find the flood risk for your business now using our One-Step Flood Risk Profile.
Flood insurance is available to homeowners, renters, condo owners/renters, and commercial owners/renters. Costs vary depending on how much insurance is purchased, what it covers, and the property’s flood risk.
Coverage for your building and contents is available. Talk to your agent today about insuring your business and its contents. Typically, there’s a 30-day waiting period from date of purchase before your policy goes into effect. That means now is the best time to buy flood insurance.
Business Property Risk
As a business owner, you know that protecting your building and your contents is vital to its survival. Your business is either in a high-risk or moderate-to-low risk area and insurance premiums vary accordingly.
Most commercial buildings in a moderate-to-low risk area qualify for coverage at a preferred rate. Preferred Risk Policy premiums are the lowest premiums available through the NFIP, offering building and contents coverage for one low price. You can also opt for Contents Only coverage, if you prefer. Premiums start as low as $567 per year for both Building and Contents, while Contents Only coverage starts at $162 per year. Commercial coverage gives you up to $500,000 of insurance to protect your building and up to $500,000 to protect its contents.
If you don’t qualify for a Preferred Risk Policy, a standard rated policy is still available. Even though flood insurance isn’t federally required, anyone can be financially vulnerable to floods. People outside of high-risk areas file over 20% of NFIP claims and receive one-third of disaster assistance for flooding. When it’s available, disaster assistance is typically a loan you must repay with interest.
If you live in a high-risk area, a standard rated policy is the only option for you. It offers separate building and contents coverage.
Flood insurance premiums are calculated based on factors such as:
- Year of building construction
- Building occupancy
- Number of floors
- The location of its contents
- Its flood risk (i.e. its flood zone)
- The location of the lowest floor in relation to the elevation requirement on the flood map (in newer buildings only)
- The deductible you choose and the amount of building and contents coverage
If your commercial property is in a high-risk flood area and you have a mortgage from a federally regulated or insured lender, you are required to purchase a flood insurance policy.