How you can get flood insurance with zero wait time

By Amy Davis - Reporter/Consumer Expert

HOUSTON - Hurricane season started Saturday, June 1. Being prepared in the greater Houston area means getting flood insurance, even if you're not in a flood zone.

There is usually a 30-day waiting period for your flood insurance to take effect, but now some private insurers are offering flood policies with zero wait time.

Sixty-four percent of homeowners who flooded during Hurricane Harvey had no flood insurance. Those who did had it from the National Flood Insurance Program. 

No matter how much it costs to rebuild, you won't get more than $250,000 from the federal program. When you do sign up, you will wait 30 days for your policy to take effect. 

Gordy Bunch, founder of The Woodlands Insurance Company says he is trying to change that.

"We're trying to make it easier to get the coverage and easier to use the coverage at time of loss," Bunch explained.

TWICO is not the only private insurance company selling no-wait flood policies, but it may the only one in Texas that will combine your homeowners and flood insurance in one policy with one premium.

"Right now most insurance is sold as separate policies," Bunch told Davis. "You know wind policy, a flood policy and a homeowner's policy."

After Hurricanes Harvey and Ike, homeowners were waiting for multiple adjusters to come assess their property. 

"This product was born out of seeing those frustrations of our own customers and knowing that we could do a better job and make it a lot easier for them," Bujch said.

There are some other differences between private flood policies and the NFIP.

- NFIP offers no more than $250,000 for repairs. 
- Private policies can cover up to a million dollars.
- NFIP does not provide loss of use coverage, while private flood insurance does. Loss of use coverage pays for your relocation while your home is being repaired.

"And that's the difference between living in your in-laws' house or living in a rental while your home is being recovered," Bunch said. 

Private flood insurance has been around since 2012, but it just recently started getting more popular. It is largely untested in major disasters. If you're considering it, you should get quotes from several sources like the federal insurance program and some private companies. You can also look up an insurance company's ratings to determine the company's stability.

Insurance companies receive their financial strength ratings from insurance rating organizations which analyze and evaluate a company’s financial performance. Each insurance rating organization uses its own formula for determining the varying degrees of financial strength ratings and their significance. You want an A-rated insurance company.

Here are some insurance ratings organizations you can check: 

A.M. Best
Fitch Ratings
Standard & Poors

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