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Flood Insurance for Businesses

Flood Insurance for Businesses

Flood insurance is more important now than ever. Flood events across the country in the last few years are affecting not only homeowners, but also businesses. In August 2016, Louisiana experienced flooding that cost over $3.8 billion in losses. Included in that figure were over 6,000 businesses, many uninsured. What many business owners don’t know is that flood is not a covered peril under your business package insurance policy. It also cannot be included in these policies. Flood insurance is always a separate policy, but it can be purchased in different ways. Here is what you need to know about flood insurance for businesses: Basic Flood Insurance The National Flood Insurance Program (NFIP) offers basic flood insurance limits for businesses. Because this is a government program, coverage is limited to: $500,000 or replacement cost value per structure at any one location, whichever is less. $500,000 or replacement cost value in contents coverage per structure at any one location, whichever is less. In addition, policies are limited to one structure per policy.  Even if your building is worth more than $500,000, the limit may not exceed $500,000. Underwriting requirements include a flood elevation certificate, two pictures of the structure front and back and payment in full of the policy premium. Unless the insurance is for a loan closing, there is typically a 30-day waiting period before the policy goes into effect. Private Market Insurance While NFIP used to be the only game in town, this is no longer the case. There are private insurers available to insure businesses for the peril of flood. The good news is that these insurers...