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Agents.FloodSmart.gov

FEMA P-1033/March 2016
 
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PROTECT YOUR CLIENTS. BUILD YOUR 

BUSINESS. LEARN TO SPEAK FLOOD. 

Every licensed property insurance agent can sell flood insurance 

through the National Flood Insurance Program (NFIP). But flood 

insurance has a special language—and requires specific sales 

knowledge. That’s why the NFIP has prepared this guide. 

It will help you learn to “speak flood” to your clients. And it will 

show you how to gain access to all of the sales and marketing 

tools and tips waiting for you at Agents.FloodSmart.gov. 

Know flood. Speak flood. Write flood. Get FloodSmart 

Agents.FloodSmart.gov 

WHY LEARN TO SELL FLOOD INSURANCE? 

Tell your clients that: 

• Floods are the #1 natural disaster in the U.S. 

• The average flood insurance policy is about $700 a year. 

And in moderate- to low-risk areas, homeowners can financially 

protect their properties with Preferred Risk Policies (PRPs). 

• From 2010 to 2014, the average flood claim was more than 

$42,000. 

• Anywhere it rains, it can flood. More than 20 percent of all 

flood insurance claims come from areas outside of mapped 

high-risk flood zones. 

Flood insurance is smart for home and business owners. And smart 

for agents. Learn why. 
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SELLING FLOOD INSURANCE BUILDS 

(AND PROTECTS) YOUR BUSINESS. 

Build your business. Insurance is about trust. Your clients trust 

you to know what they want and need in homeowners, life, auto, 

umbrella, liability or other lines of coverage. By establishing flood 

insurance as a significant part of your portfolio, you can make 

your clients aware of a key vulnerability in their coverage and 

more fully protect them, further building trust and increasing 

potential for additional sales. 

Protect your business from lawsuits. Your clients trust 

you to keep them informed about the protection they need and to 

offer that protection. They also expect you to have the technical 

knowledge you need to accurately sell and service flood insurance. 

The top two Errors and Omissions (E&O) pitfalls are not offering 

coverage and not offering the right amount of coverage. As a 

well-trained and motivated flood agent, you can protect yourself 

from possible E&O-related lawsuits. 

GO TO AGENTS.FLOODSMART.GOV 

TO ACCESS CRITICAL TOOLS. 

Advertising templates and free leads are only available 

to registered FloodSmart agents. Learn more about 

free registration and tools at Agents.FloodSmart.gov. 
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-

TO SPEAK FLOOD, 


YOU HAVE TO KNOW FLOOD.
 

We all know a flood when we see one— 

but the NFIP has an official definition: 

“A general and temporary condition of partial or complete 

inundation of two or more acres of normally dry land area, or 

of two or more properties (at least one of which is your property).” 

The NFIP explains the cause of a flood in four ways: 

• Overflow of inland or tidal waters; 

• Unusual and rapid accumulation of runoff of surface waters from 

any source; 

• Mudflow (a river of liquid and flowing mud on the surfaces of 

normally dry land areas, as when earth is carried by a current 

of water); or 

• Collapse or subsidence of land along the shore of a lake or 

similar body of water as a result of erosion or undermining 

caused by waves or currents of water exceeding anticipated 

cyclical levels that result in a flood as defined. 

FLOODS HAPPEN EVERYWHERE. 

Snow melt in the Midwest brings spring flooding. Heavy winter 

rains on the West Coast create flooded homes and mudflows. 

Hurricanes and tropical storms drench the country from New 

England to the Mid Atlantic to the Gulf, and can seriously impact 

communities hundreds of miles inland as well. The fact is, floods 

occur in all 50 states. Because anywhere it can rain, it can flood. 
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KEY DIFFERENCES BETWEEN

HOMEOWNERS AND FLOOD INSURANCE. 

Homeowners insurance covers both personal property and the 

dwelling under one policy. So can a flood insurance policy. 

However, unlike homeowners insurance, the NFIP gives the 

property owner the option of including contents. It generally 

is not an automatic coverage.

PRPs offered in moderate- to low-risk areas, cover structures 

and personal property jointly. For all standard-rated policies, 

personal property coverage and dwellings coverage have 

separate limits. Structural and contents coverage is also offered 

for commercial properties.

Replacement cost is available as a settlement option for principal 

single-family residences. The property must be insured to a minimum 

of 80 percent of Replacement Cost Value. All personal property 

claims are paid on actual cash value—their depreciated cost.

As shown later in this guide, costs for both residential and 

commercial coverage are determined by level of risk.

Be sure your clients know there’s no such thing as a “little flood.” 

Show them the financial implications of flooding using the Cost 

of Flooding tool at FloodSmart.gov or use the embed code on 

Agents.FloodSmart.gov to add the tool to your own website.
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KNOW WHAT’S COVERED. 

The NFIP pays for direct physical loss by or from flood. For 

example, if a sewer backs up into a client’s home because of 

flooding in the area, the damage is covered. If the backup has a 

different cause (such as tree roots around a line) it’s not covered 

by flood insurance. Refer to the NFIP policy for a complete 

explanation of coverages and exclusions. 

Building coverage: In addition to the building and its 

foundation, building coverage pays for permanent items such as: 

plumbing and electrical systems; HVAC systems; water heaters; 

refrigerators, stoves and built-in dishwashers; permanently installed 

paneling, wallboard, bookcases and cabinets; and debris removal. 

Some items that are often located in basements—such as a 

furnace, hot water heater and circuit breaker—are also covered 

by a structural policy. Other items that may be in a basement, 

such as a washer and dryer, are only covered through personal 

property coverage—and have limited coverage in basements, 

as described below. 

Personal property coverage: Clothing, furniture and 

electronic equipment are covered, but so are appliances that 

are not permanently installed, such as portable microwaves, 

dishwashers and air conditioners, as well as window air 

conditioners. Clothes washers and dryers are also considered 

personal property, as are food freezers and their contents. 

It’s a good idea to tell flood insurance clients to have an inventory 

of their home in case they need to make a claim. They can learn 

more at KnowYourStuff.org. 
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KNOW WHAT’S NOT COVERED. 

When clients are dealing with flood damage, the last thing they 

need is a surprise. So you should walk them through the Standard 

Flood Insurance Policy for a full list of coverages and exclusions 

at the time of application. The following are a few examples of 

what is not covered. 

Property outside a building. This includes decorative and 

recreational items such as swimming pools, hot tubs, decks, patios, 

fences and walkways, as well as septic systems. Plantings are also 

not covered. 

Certain high value items. Currency (including rare coins), 

precious metals and stock certificates. 

Damage that could have been avoided. This includes 

moisture, mildew or mold resulting either from a pre-existing 

condition or from lack of timely remediation. 

Also excluded are payments for living expenses, such as temporary 

housing, and financial losses caused by business interruption or the 

loss of use of insured property. 

Some valuable items, such as original artwork and furs, are 

covered under flood insurance. But the limit is $2,500. 
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COVERAGE CAN BE AFFORDABLE. 

Many people believe flood coverage through the NFIP is always 

expensive. But that’s not the case. Most property owners who live 

in a moderate- to low-risk area (indicated as B, C or X zones on 

flood maps) will qualify for a PRP, which is more affordable. Here 

is a sampling of annual premiums, as of April 2016, for PRPs for 

single family residences. The NFIP Flood Insurance Manual details 

more options, including building/contents and contents-only 

coverage for non-residential properties and the annual Homeowner 

Flood Insurance Affordability Act (HFIAA) surcharge. 

Residential PRP Annual Premiums* 

Building Contents Premiums 

$20K...................................$8K..................................$146
 

$100K.................................$40K................................$324
 

$250K ...............................$100K..............................$425
 

* An additional $25 annual HFIAA surcharge will be applied for primary 

residences and $250 for all other occupancies. 

NOTE: Home and commercial property owners should generally 

elect to secure both forms of coverage, while renters should elect 

to only purchase contents coverage. 

Individual condominium unit owners, renters, home, and 

business owners can get peace of mind from obtaining 

a PRP. Check your book of business for leads. 
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KEY POINTS FOR CLIENTS.

When discussing flood insurance, there are several important 

points to share with your clients.

• Get flood insurance now, because you can’t get it 

at the last minute. In most cases, it takes 30 days after 

purchase for a policy to take effect, so it’s important to buy insurance 

before the storm approaches and the floodwaters start to rise.

• No matter what your risk is, you can purchase flood 

insurance. The only requirements are that your community 

participates in the NFIP and your property qualifies for coverage. 

Visit www.fema.gov/national-flood-insurance-program-communitystatus-book for more information. 

• If you are in a high risk area, insurance is mandatory. 

This is required if you carry a mortgage from a federally 

regulated or insured lender.

• If you live outside a high-risk area, you might qualify 

for a lower-cost PRP. 

• If you own your property outright, you should still 

be financially protected by flood insurance. Statistics 

show that if you live in a high risk zone, you are more likely to 

experience a flood than a fire.

No matter how strong these points are—and how good a 

salesperson you are—some clients will raise objections to the 

idea of flood coverage.
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OVERCOMING COMMON 

CLIENT MISCONCEPTIONS. 

You already know to tell your clients that homeowners insurance 

doesn’t protect from flooding—and that flood insurance can be 

especially affordable in moderate- to low-risk areas. 

Here are some other objections you can encounter—along with 

ways to overcome them by “speaking flood.” 

Client: If my property is hit by a flood, disaster assistance will 

bail me out. 

You:	 Maybe—as long as the President declares a disaster, 

which doesn’t always happen. But even if it does, Federal 

assistance is usually a loan. Borrow $50,000 at 4% and 

you’ll pay about $240 a month for 30 years, in addition 

to your mortgage. 

Client: My house is on a hill, so water drains away. I’m safe. 

You:	 Your risk may be reduced, but it’s not eliminated. If your 

community’s stormwater drainage system clogs or fails, 

flooding from heavy rain or melting snow could cause 

damage to your home and contents. If your home’s 

location puts you in a moderate- to low-risk area, 

lower-cost flood insurance is available, so it just makes 

sense to protect yourself. 

Clients don’t want to think about flooding. Your job is to make 

them aware of their risk. 
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OVERCOMING COMMON

CLIENT MISCONCEPTIONS.

Client: My area has never flooded, so I’ve got history on

my side.

You: Conditions change. Nearby construction can alter 

drainage patterns, and rainfall can exceed yearly 

averages. In addition, nearby community stormwater 

drains can clog and quickly back up water during heavy 

rains, causing localized flooding. What’s happened in 

the past is no guarantee of what will happen in the future.

Client: There was a flood in my neighborhood 20 years ago 

and I live in a 100 year flood plain. So nothing’s going 

to happen in my lifetime.

You: This is a common misunderstanding. The phrase 

“100 year flood” doesn’t mean an area only risks 

being flooded once a century. It means that there’s a 

1% chance of flooding each year. Some “100 year flood” 

areas have seen two or more floods within a 10-year span.

More talking points and sales “barrier busters” are waiting 

at Agents.FloodSmart.gov. 
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AGENTS.FLOODSMART.GOV HAS 

TOOLS TO SHOW YOU HOW TO 

“SPEAK FLOOD.” 

The NFIP created FloodSmart.gov to give home- and business 

owners an overview of the NFIP and flood insurance while also 

showing them the devastating consequences of flooding. 

Agents.FloodSmart.gov offers you resources to reinforce this 

consumer messaging, such as testimonials, flood risk scenarios 

and an interactive tool that can help you demonstrate the cost of 

flooding. And you can embed these tools on your agency’s own 

website to show how flood savvy you really are. 
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AGENTS.FLOODSMART.GOV IS 

DESIGNED TO HELP YOU SELL. 

When you register at Agents.FloodSmart.gov, you have access to 

terrific business tools. Here’s an overview. 

Referral Program: It’s the quickest way to get qualified leads— 

for free. Prospective clients learn about flood zones and insurance 

costs through FloodSmart.gov and the NFIP Referral Call Center, 

and when they’re ready to find an agent, they’ll be connected to you! 

Finding new clients is simple 

1) Enroll online* so that your contact information is available via 

FloodSmart.gov, the NFIP Referral Call Center and NFIP mailings 

after enrollment. 

2) Through FloodSmart’s mailings and advertising, property 

owners learn about the risk of flooding and are directed to visit 

FloodSmart.gov or contact the NFIP Referral Call Center to learn 

about flood insurance. They are then connected with an agent 

through the Agent Locator feature. 

3) Our direct mail, FloodSmart.gov, and the NFIP Referral Call Center 

use the Agent Referral Database to offer potential clients contact 

information of flood insurance agents in their area—like you! 

4) Consumers who contact the NFIP Referral Call Center have the 

opportunity to be transferred directly to a participating agent, 

who will be given the consumer’s contact information. 

5) Voila! A potential new client! 

* A minimum of two hours of flood insurance training every two years is 

required for enrollment. Visit Agents.FloodSmart.gov for more details. 
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TRAINING AND TOOLS TO 

GROW YOUR BUSINESS 

Agent Training. To be part of the Referral Program, agents must 

have taken a minimum of two hours of training on flood insurance 

in the past 24 months. This training must be renewed every two 

years. For more details, visit Agents.FloodSmart.gov/Agents/ 

find-training-programs. 

Interactive Tools. Agents.FloodSmart.gov offers a variety of 

interactive tools that can be embedded on your website to help your 

customers understand their flood risk, and why flood insurance is 

important for protecting their finances. 

Tools include: 

Cost of Flooding Tool: This tool illustrates how much flood 

damage is caused by just a few inches of flooding. 

Flood Risk Scenario Tool: Through this tool, your customers 

can see how various factors can impact both their property and 

their neighborhood. 

Levee Simulation Tool: Informs customers about levees— 

how they work and how they can be overtopped or fail. 

You’ll find more information on all marketing and training programs 

at Agents.FloodSmart.gov. You’ll also find marketing tips and sales 

“barrier busters,” and you can sign up for newsletters and alerts so 

you’ll always have up-to-the-minute knowledge of flood insurance. 
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FEMA P-1033 

Catalog No. 15198-1