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Thursday, June 23, 2016

Don’t be late on your flood insurance renewal payments! or you could pay THOUSANDS more!!!

FEMA has changed the rules again!  And this time, a forgotten payment could really be a disaster!

As of April 1, 2016, the Homeowners Affordability Act (HFIAA) requires the NFIP to track and apply rating changes to certain flood policies that lapse.


The Short Version -
a) Flood gives you a 30 day grace period for payment, if you pay, your policy is in good shape.
b) If your payment is late between 30 and 90 days, you can get your policy reinstated (only one late pay allowed during the life of your policy!)
c) If payment received over 90 days past due, or you pay late for the second time, you lose your policy and have to start over --- the rates may be THOUSANDS higher :(

The Long Version -
A lapse is defined as:
1) Premium paid after the policy's 30 day grace period ends, but is paid within the 90 days of the policy's expiration (effective) date.
*this first offense forgiven, but not forgotten
2) Premium paid after 90 days past the policy's expiration (effective) date.

Payment made within the 30 day grace period is not a lapse.  However, payment made after the grace period expires will trigger the Lapse rule to become active, and the following outcomes applied:

Policy  A  Premium Due Date Premium paid within 30 days (the grace period)
                 No Lapse Policy keeps the same rating criteria and effective date
Policy  B  Premium Due Date Premium paid after 30- day grace period BUT within 90 days of the policy expiration date
                First Lapse occurs- No change in rating, but policy is flagged and lapse is reported to the
                 Policy will renew and the effective date will be  30 days from the date the renewal
                        premium is received.
Policy  B  Premium Due Date Premium paid after 30 day grace period BUT within 90 days of the policy expiration date Second  Lapse occurs (anytime during the life of the policy)
                 Policy is re-rated   Policy will not renew.  A new policy will be issued and the effective date will be 30 days from the date the premium and, in some cases a new application may be required, is received (see below).

Policy  C  Premium Due Date Premium paid after 90 days or more from the policy expiration date Policy fully Lapsed -noted as expired or cancelled
             New Application required
New Policy: a new application will be required and the standard waiting period rules apply.

As mentioned above, the certain policies that are subject to the "lapsed policy rules" apply to:
Pre-FIRM subsidized rated policies in SFHAs:  When a new policy is required as noted above, the building must be rated using full risk rates which means a new application and an Elevation Certificate (EC) will be required.
Policies rated with Newly Mapped rates:
o if Pre-FIRM--full risk rates apply and a new application and EC is required;
o If Post-FIRM--full risk rates based on current flood zone and BFE, or if eligible, may use built in compliance grandfather rule.
Grandfathered based on continuous coverage: no longer eligible due to break in coverage.

Check out this Don't Pay Late consumer resource to understand the NFIP rules on policy lapses to clients.  You can avoid potential rating changes by paying policy premiums on time.

Your Trusted Choice Insurance Agent, SouthGroup Insurance Gulf Coast wants you to know you can call on us with your questions or concerns seeking more helpful advice or answers to your pressing insurance questions. A full insurance review is always your best bet to make sure you have all of the adequate coverage for your personal insurance needs. Remember, we offer a personalized insurance review to anyone who is interested at no charge – just visit any one of our 3 convenient coastal locations!

We are your LOCAL Trusted Choice Advisors, SouthGroup-Gulf Coast ,  SALES AND SERVICE AGENTS: Angelyn Treutel Zeringue, Tammy Garfield, Tammy Hogue, Brittany Jones, Denise Russell, Melissa Moran, Alex Treutel, Anne Gillam, Ashlie Moody, Mark Strickland, Johnny Walton, and Whitney Zimmerman Webb at SouthGroup Gulf Coast. You can reach us by snail-mail or in person: 412 Hwy 90, Suite 6, Bay St Louis MS 39520, email: , phone: 228-466-4498 fax:888-415-8922,  FaceBook, or Twitter ! 

We have 3 Gulf Coast locations to serve you - 2505 Pass Road - Biloxi, 5400 Indian Hill-Diamondhead, and 412 Hwy 90 Suite 6-Bay Saint Louis, MS. We write coverage in 40 different states and can assist you with Mississippi insurance, Louisiana insurance, and Alabama insurance and many other states. 

Insurance is stressful, but we make saving easy.  We help you save money on insurance!

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