Better Flood

Can I cancel my flood insurance and get a refund check?

FEMA says that canceling flood insurance coverage can be terminated at any time. Still, they make it really hard to do so because of the federal law that requires flood insurance for any property with a mortgage. 

The NFIP has 14 “reasons” that they allow property owners to cancel an active flood policy.

  1. The building is sold or removed. (need documents) 

    1. Contents sold or removed (need proof and documents)

  2. The policy can be canceled if rewritten. 

  3. Duplicate NFIP Policies (the NFIP ignores that there is a private flood market and will not cancel if you have a private flood policy – your only option is to cancel the private flood policy) 

  4. Non-Payment 

  5. If the risk is found not to be eligible for coverage

  6. If your property closing did not occur

  7. If you get a letter from your lender stating that flood insurance is no longer required. 

  8. If you get a letter from your lender saying that they no longer require flood insurance because the flood zone is now low-risk.

  9. If you have a unit owner policy and there is an RCBAP policy that is in place by your HOA

  10. If you pay off your Mortgagee and provide documents from your lender that say they no longer have interest in the property.

  11. Voidance before the effective date (this is if you got another policy, this time a private flood policy, so you can save money. The only requirement is that the dates MUST align. If they do not, then you will not be able to cancel the NFIP policy. It is best to get the private flood policy in place before the expiration of the current policy and already provide the cancel request before the new policy year. A flood nerd can help you with this. 

  12. Voidance due to credit card error (Similar to non-payment) 

  13. If you get a letter from FEMA saying that flood insurance isn’t required because your structure has been removed from the high-risk flood zone. Note you will also need a letter from your lender releasing the requirements. 

  14. The policy was written at the wrong address.

  15. Cancel/rewrite due to misrating. 

  16. Request to cancel your flood insurance due to Map revision, LOMA, or LOMR.

Should I cancel my flood insurance policy?

As flood nerds, we know how to help you cancel a policy (although we recommend you keep some kind of coverage unless you sell the property). Most agents don’t know how to, and sometimes the best path is to just let the policy expire and not pay the premium the following year because NFIP makes it so difficult it could take some time months, and frequently policies expire before the cancel request is approved. Less headache to just let it run its course.

What about private flood insurance?

Since the NFIP set the standard for flood insurance in the US, most private flood policies follow these same reasons. So they can be a bit tricky. The guaranteed way to cancel a policy is to sell the property.

What is needed to cancel a flood insurance policy?

We need to discuss refunds if you can successfully cancel your flood insurance policy. Again most of the time, the refund is so minor compared to the amount of time it will take for you to acquire all the required documents, so the best course of action is to just let the policy expire. 

If you paid for a policy for a loan closing and that loan didn’t close, you just need to provide documents that say that the property didn’t transfer to you, and you will likely get a full refund. 

So the private flood policies have a 25% fully earned clause, so basically, 3 months of coverage, so if you are going to cancel. You are doing it within the first to the third month of the term. You should keep the coverage until the 25% earned is done. That way, you still have coverage (God forbid something to happen, which sometimes does). And then cancel if you still desire the 3rd month, and if done right, you will get 75% of the premium back.

How long will it take for me to get a refund if I get approved to cancel my flood insurance?

Some underwriters are better at sending out a refund check promptly; some will send it to the client directly, and some will send it to the agent a month after the approved cancel request, so you will have to be a little patient. 

If you are getting a refund, the most important detail has an appropriate address to which the check should be mailed. You would be surprised (or not) how many people sign that the address on the cancel request is the address they want the check to go to and don’t even consider that the address is a structure they do not live in anymore. So please check your mailing address and ensure it is the best palace to receive your refund.

Cancel your NFIP flood insurance policy.

If you need help canceling your expensive NFIP flood policy for one of our better-priced private flood policies, a flood nerd would be happy to help. Feel free to call us at 1-866-990-7482 or fill out our online quote request so we can show you how much money you will save when you cancel the NFIP flood policy.

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