If you live in Florida, flood insurance isn’t just nice to have. It’s a smart investment. (After all, flood coverage isn’t included in your commercial or home insurance policy.)
But when it comes time to buy a policy, many homeowners and business owners find themselves asking: “Should I go with private flood insurance or the NFIP?”
Both private insurance and the National Flood Insurance Program (NFIP) can provide valuable protection, but there are a few major differences that will impact you if you need to file a claim.
In this guide, we’ll break down your coverage options and how to choose the option that fits your needs.
What Is the National Flood Insurance Program?
The National Flood Insurance Program (NFIP), is a government-backed program created in 1968 to help property owners get affordable flood insurance when private options weren’t widely available. You might hear them referred to as “FEMA flood policies.”
NFIP policies offer two types of protection:
Building coverage – for the structure of your home or commercial building
Personal property coverage – for belongings like furniture, electronics, and appliances
The NFIP is backed by the federal government, but policies are still sold and serviced by private insurance companies through something called the Write Your Own (WYO) program. However, these policies come with set coverage limits and standardized terms, no matter who you buy from—so there’s no shopping around for better terms with NFIP coverage.
Private Flood Insurance
While the NFIP is still the most common source of flood coverage, it’s no longer your only option. In recent years, improvements in flood modeling and risk analysis have made private insurance companies more comfortable offering flood insurance, especially in areas like Florida.
Private flood insurance is issued by non-government insurers, meaning it’s not backed by FEMA or the federal government. Instead, these policies are underwritten by insurance companies who use their own guidelines, coverage options, and pricing models.
The biggest appeal of private flood insurance is flexibility. Policies often come with higher coverage limits than the NFIP and may include additional features, like coverage for temporary housing or replacement cost on personal property, depending on the carrier. This can be especially helpful for homeowners with high-value properties or businesses that need broader protection.
It’s also worth noting that because private insurers are managing their own risk (rather than relying on FEMA’s standardized structure), coverage terms and availability can vary more—which makes working with an independent agent especially important when comparing options.
Private Flood Insurance vs. NFIP
When comparing private flood insurance vs FEMA coverage, it’s important to pay close attention to how they differ. Let’s walk through what some of those differences actually mean for you:
Coverage Limits
Under the NFIP, building coverage is capped at $250,000 and personal property coverage at $100,000. That may not be enough to fully protect high-value homes or businesses, particularly in Florida’s coastal areas where property values tend to be higher.
Private flood insurance often offers higher limits, sometimes exceeding $1 million for buildings and $250,000 or more for contents, depending on the carrier.
Replacement Cost vs. Actual Cash Value
NFIP policies typically pay replacement cost only for the structure of a primary residence, and contents are covered at actual cash value—which factors in depreciation. That means your payout may be less than what it costs to replace items.
Some private policies offer replacement cost coverage on contents and even on secondary homes, which can make a big difference in how much you’re reimbursed after a loss.
Waiting Periods
The NFIP has a standard 30-day waiting period before coverage begins, which can be a problem if a storm is approaching. Private flood insurance may offer shorter waiting periods—sometimes as little as 15 days or even none at all—giving you more flexibility when time is tight.
Additional Living Expenses
If your home becomes uninhabitable due to flood damage, NFIP policies don’t include coverage for temporary housing or relocation expenses; many private policies do. This benefit—called additional living expenses (ALE)—can help pay for a hotel or rental home while your property is being repaired.
Extra Coverages
Private flood insurance may also include additional coverages not available through the NFIP, such as pool repair, detached structures, or higher limits on valuable contents.
While private flood insurance can offer broader protection, it’s not right for everyone—and not every property is eligible. That’s why it’s so important to talk with an independent agent who can compare both options and help you choose the policy that fits your needs and budget.
Do I Really Need Flood Insurance?
Yes!
Even if you’re not in a high-risk flood zone, that doesn’t mean you’re safe. Flood zones change over time, and as we’ve seen in recent years, heavy rain, hurricanes, and storm surges can cause flooding in areas that were previously considered low-risk. In fact, FEMA reports that more than 20% of flood claims come from properties outside high-risk flood zones.
Another reason you need flood insurance? Flood damage is not covered by your homeowners or commercial property insurance. Without a separate flood policy, you’re on your own for repairs, replacements, and cleanup costs.
Think of flood insurance as a financial safety net—not just for worst-case scenarios, but for the kind of unpredictable weather Florida sees every year. Whether you own a home, rental property, or business, having the right coverage in place means you won’t have to wonder what happens if the water starts rising.
Protect What Matters Before the Water Rises
When it comes to flood insurance, understanding your options now can save you major stress—and money—later. Whether you choose a government-backed NFIP policy or a private plan with broader coverage, the most important step is making sure you’re protected before disaster strikes.
At Darr Schackow Insurance, we work with both NFIP and private flood insurance providers, so we can help you compare policies and choose the one that fits your property, location, and budget. Our agents are here to guide you—not sell you something you don’t need.
Have questions about flood insurance or want to explore your options? Contact us today for expert guidance and a no-obligation quote.