Private Flood Insurance & Cancelling FEMA Flood Policy
NFIP Cancellation Reason Code 26
Changes that became effective October 1st, 2018 (updated April 2019), are still in effect and provide flood insurance customers with greater freedom to choose their own Private Flood Insurance Provider. If certain conditions are met, customers are eligible to cancel/nullify their NFIP flood insurance policy.
Prior to NFIP’s 2018 changes, canceling an NFIP flood insurance policy was price prohibitive in many cases because no refunds were available. Now, flood insurance customers can choose to cancel their NFIP policy using Reason Code 26 (duplicate coverage) if they meet NFIP requirements.
Reason Code 26—How to Cancel a NFIP Flood Insurance when Duplicate Coverage from a Private Flood Insurance Company is purchased.
- This can only be used when the insured did not intend to renew or purchase the NFIP policy because they purchased duplicate flood insurance coverage from a non-NFIP insurer.
- The NFIP will presume that an insured did not intend to renew their policy if they purchased a duplicate non-NFIP (Private Flood) policy prior to the NFIP policy’s purchase or renewal date.
- There is NO Mid-Term cancellation of a NFIP Policy.
- NFIP will require the declarations page for the non-NFIP flood insurance policy that you are replacing the NFIP policy with.
- This declaration page, along with a signed cancellation request must be mailed to the NFIP insurer within 30 days of the NFIP policy becoming effective.
- If you miss the 30-day deadline, you are at risk for paying premium for duplicate flood insurance policies.
Rates through NFIP are increasing in nearly all cases but homeowners have more options now. In the past, NFIP rules that restricted the ability to cancel policies kept many consumers captive to their existing flood insurance policies. With private flood insurance options growing rapidly, homeowners can choose from other coverage options that may be more affordable or which may provide more comprehensive coverage.