How to save $30,000 in flood insurance premiums

  • October 14, 2021

More than a third of homeowners in the US have flood insurance and some are going broke on the insurance, according to the Insurance Information Institute.

The average annual deductible is about $6,000.

Here are the top 10 ways to save money.

1.

Make a down payment.

Homeowners with flood insurance can apply to down-payments in installments of $25,000 or less.

They can pay the balance as early as next year.

If you can’t pay the mortgage or property taxes on your down payment, you can pay them off with your money in the future.

That’s why some people who qualify for a downpayment in the current market may not qualify for the same insurance benefits in the next market.

2.

Get a pre-purchase flood insurance policy.

Some lenders offer a pre or post-purchasing flood insurance program that allows homeowners to buy the policy at a lower cost than the actual deductible.

This is called a “sub-insurance” policy.

3.

Don’t go bankrupt.

Most flood insurance policies are sold as insurance only, not as a whole.

You can use a separate policy to cover any additional expenses.

For example, you could buy a flood insurance plan that provides coverage for the value of property damaged in a hurricane.

But that doesn’t guarantee that you will be able to make the payment in full when you sell the policy, the III said.

4.

Get help from a financial adviser.

The best way to protect yourself from losing your home is to have a financial advisor who understands your financial situation, the Insurance Institute said.

You might need a mortgage broker or mortgage insurance agent to get you into the mortgage market.

5.

Don the water suit.

A number of states allow homeowners to wear water suits while in flood waters, so you can take a spill and keep your insurance.

6.

Consider a flood prevention plan.

If the flood damage is serious enough, you may need a plan to protect your home against future damage.

Here’s how to do it. 7.

Donate money to a disaster relief organization.

The III recommended that you make a donation to the National Flood Insurance Program, a nonprofit group that assists individuals and small businesses with disaster insurance.

You don’t have to do this directly with the I.R.S., but it is helpful to do so. 8.

Shop around for flood insurance.

Some states offer homeowners a discount for buying flood insurance, the Institute said, and the discounts are usually worth between 20 percent and 35 percent of the actual premiums.

9.

Make your mortgage payment.

When you buy a home, you need to pay the full amount, not just the difference between the amount you paid for the mortgage and the amount of your downpayment.

That can be a problem if you’re under the mortgage because you have to pay your rent or mortgage interest.

The easiest way to avoid paying your mortgage interest is to make a down Payment.

10.

Avoid foreclosure.

Many lenders allow you to foreclose if you have the ability to pay off the mortgage before you sell your home.

That allows you to avoid the mortgage penalties.

Here is how to avoid foreclosure if you can.

Read more about insurance at The Wall Street Journal.