FloodFLEX
What is FloodFLEX?
FloodFLEX is an endorsement to a standard flood policy that provides an additional supplemental loss payment based on the building loss amount the insured would normally receive (after application of the deductible). The supplemental loss payment may be used however an insured would like. It is the insured’s money, they can and should use it as they see fit!
Why FloodFLEX?
Flood claims on a standard flood policy have numerous out of pocket expenses that most insureds do not consider when they initially purchase a policy. A building could unknowingly be underinsured, property could be damaged that is not covered under a standard flood policy, items stored in basements, outbuildings, wages could be lost for employees who cannot get to work because of the flood damage, the insured could have a high out of pocket deductible, and this list goes on… FloodFLEX could help offset some or all of these expenses.
Protect Your Agency
The benefits of FloodFLEX protect the agent, too. It is easy to sell because there are no limitations in coverage and the additional percentage of building coverage that FloodFLEX offers can be tailored to the individual client. It can also be used towards property the client unknowingly withheld from you or for items that you, as their agent, are unsure of how or when standard coverage applies. Did you mistakenly tell an insured their flood policy covers the pool or storage shed? Did an insured “forget” to mention they keep a prized antique piano in their basement and are they wondering why you didn’t ask about it? You can be the expert and offer FloodFLEX coverage to help fill the gap for items not covered under a standard policy and prevent a potential E & O claim from occurring.
How does FloodFLEX work?
The endorsement added to the standard flood policy jacket is:
FloodFLEX endorses the policy to increase the loss payable for COVERAGE A – BUILDING COVERAGE, after the application of the Building Deductible found on the Declarations Page, by 5%, 10%, 25%, 50% or 100% percent. All other terms and conditions of this policy remain the same.
In the event of a claim, the insured would see one payment for the covered items just like a standard policy and then a SECOND check for the FloodFLEX endorsement equal to the selected percentage of the building claim payout.
Example 1:
The insured carries $1,000,000 building coverage with a $10,000 deductible and $500,000 contents (business personal property) with a $10,000 deductible. They have opted to purchase 10% FloodFLEX coverage. The building suffers a loss (after the application of the deductible) of $1,000,000 to the building. The contents suffer a $500,000 loss (after the application of the deductible). The insured would receive two checks:
Check #1: $1,500,000 for the loss to the building and contents coverage
Check #2: $100,000 for the FloodFLEX payout (10% of the Coverage A-Building Coverage loss amount)
That second $100,000 check can then be applied to ANYTHING. They could choose to recover the depreciation taken out for the ACV valuation. They could use it as a deductible buy back. They could use it for any business income loss they may have incurred. The insured can use it however they want. We do not ask insureds to provide evidence of how used their FloodFLEX funds.
Example 2:
The insured has a $500,000 building insured for $300,000 with a $5,000 deductible and has no contents coverage. They have opted to purchase 100% FloodFLEX. The building suffers a $200,000 loss after the application of the deductible. The insured would receive two checks:
Check #1: $200,000 for the building coverage loss
Check #2: $200,000 for the FloodFLEX payout (100% of the Coverage A-Building Coverage loss amount)
The second $200,000 check can be applied to ANYTHING. Re-building to proper building codes, BI, loss of rents, apply towards depreciation, or use the extra $200,000 towards the TOTAL building loss that occurred. It is the insured’s money and can be used as they see fit.
FloodFLEX can be quoted instantly online at https://www.privatemarketflood.com/calculate-your-own-premium. The endorsement is also available, on request, for single family and 2-4 family homes to help pay lost rental income or depreciation.
If you have any questions feel free to contact our underwriting team at 877-356-6348 or via email at new-business@tfia.com.
