Surrounded by water on 3 sides, New Jersey’s coasts have a long history of floods and storm surge. But even inland areas face flood risks. On a sunny day in the Garden State, it may be tough to imagine water filling businesses and homes dozens of miles from the shore. It can happen, and it’s happened more often than many realize. Here’s what you’ll need to know about buying flood insurance in New Jersey to protect your home.
Best Cheap Flood Insurance Providers in New Jersey
Recent years have brought big changes to New Jersey’s flood insurance market. In the past, your only choice was to buy a policy through the National Flood Insurance Program (NFIP). However, New Jersey homeowners now have more options. An NFIP policy may still be your best bet, especially in high-risk areas that private market insurers don’t cover. Many New Jersey residents can find more options available. You just might save some money compared to the cost of a traditional flood policy.
1. Best Overall Cheap Flood Insurance: Neptune Flood
In less than 2 minutes, we had a quote for a home in suburban New Jersey. Neptune Flood isn’t just fast and affordable, it also offers some coverages not offered with standard NFIP policies. You’ll get expanded coverage for basement contents, coverage for pool repair and extra coverage for buildings on your property.
We found home coverage options of up to $2 million, which far exceed the $250,000 available with a standard NFIP policy. You may be able to avoid carrying an excess coverage policy when you choose Neptune. Similarly, personal property coverage is available with limits up to $500,000 compared to NFIP’s $100,000 limit.
Neptune Flood promises savings of up to 25%. Getting a quote will be one of the easiest things you do today.
2. Best for Fast Coverage: TypTap
Also a champ at fast quotes, TypTap offers flood insurance in a handful of states including New Jersey. TypTap can insure a home in minutes — not days. (You’ll have to wait 30 days for coverage with a standard NFIP policy. Several private market insurers cut the wait time to 14 days.)
Fast coverage isn’t TypTap’s only advantage. The company also doubles the coverage limit you’ll find on a basic NFIP policy. You can cover your home for up to $500,000. Underwriting is a snap as well. You won’t need to hunt down an elevation certificate. TypTap uses its extensive databases to understand risk instantly and offer quotes in seconds.
Getting a quote only requires you to answer 2 questions. Buying flood insurance has never been easier.
3. Best for Rate Protection: Private Market Flood
One of the problems with insurance is that premiums keep going up. With flood policies, this can make budgeting a challenge. Private Market Flood offers a plug-in replacement for an NFIP policy — and usually for less money — but the company also lets you lock in your rates for up to 3 years.
You’ll also trim 2 weeks off the wait time for coverage. Private Market Flood can cover your home in 14 days compared to a 30-day wait for an NFIP policy. For home purchase closings where the lender requires flood coverage, your coverage is immediate.
You can also purchase excess flood insurance through Private Market Flood. With an excess policy, coverage limits can be increased to fully insure your home. Pair your excess coverage with either a Private Market Flood policy or an NFIP policy to insure your home without the worry.
4. Best for Excess Flood Coverage: AIG Private Client
NFIP flood policies have 2 advantages. You can get coverage anywhere and lenders accept the coverage. However, 1 key limitation for NFIP policies is that the dwelling coverage is limited to $250,000. In many areas of New Jersey, this amount is too low.
AIG’s Private Client program offers excess coverage that pairs with a standard NFIP policy, raising the effective coverage limit to fully insure your home. Policy limits can reach up into the millions and AIG’s coverage matches your base coverage seamlessly.
AIG’s program targets homes valued at a million dollars and up. For high-value homeowners near the shore or in affluent parts of the state, AIG Private Client is worth a closer look. Because your primary coverage shoulders much of the risk, excess flood coverage may be more affordable than you think.
5. Best for Local Agents: Allstate
We’ve covered Allstate for flood insurance before. Allstate stands out because of the company’s commitment to flood-specific training and the personalized service you’ll get with local agents.
Allstate, like many other big-name insurers, offers flood insurance through the NFIP’s Write Your Own (WYO) program. In effect, you’re buying an NFIP policy, although it’s Allstate branded. NFIP policies are widely accepted by lenders.
In most areas of New Jersey, you’ll find a friendly Allstate agent nearby. Some towns have several agents. Buying online has its advantages, but if you prefer to work with an agent in person or if you live in an area not covered by private insurers, consider your local Allstate agent. NFIP coverage is available everywhere.
Cost of Flood Insurance in New Jersey
We got flood quotes for a 2,000 square foot home in a lower risk area of South Jersey. While our quotes came in under $700 annually, the cost of flood coverage depends on several factors. Insurers consider claim history, elevation, proximity to water, and the insured value of your home. For some homes in New Jersey, you may pay less than average. Other areas or high-value homes may pay significantly more.
Remember, too, that low-risk areas of New Jersey are not always “low risk”. For example, homeowners near the banks of the Delaware River in South Jersey live near a massive body of water where flooding can easily occur. Plus, there are many low-lying areas that easily flood even if they are not in an otherwise flood prone area.
Invest some time in getting a few quotes to compare prices. Many times, the savings can pay off in lower premiums for comparable or even better coverage. You can also use a deductible to help manage the cost of your flood policy.
Recent lending rule changes require lenders to escrow the cost of flood insurance in many cases. This means that you can get the coverage you need without having to pay for the cost of an annual policy all at once. Instead, the policy cost is spread out over 12 months and collected as part of your mortgage.
What Does Flood Insurance Typically Cover?
Your flood insurance policy covers specific risks that aren’t covered by a standard homeowners insurance policy. For example, mudslides and overland flooding are excluded risks on a standard home insurance policy. However, your flood insurance policy can cover these risks in many cases.
When getting quotes, you’ll see 2 main types of coverage. The first is coverage for your dwelling, which refers to your home itself. The second primary coverage is for personal property, which refers to your belongings. On a standard NFIP policy, the maximum coverage limits are $250,000 and $100,000 for dwelling and personal property, respectively.
Your flood policy can protect both your home and your belongings, but there are also coverage limits to consider. Cheap flood insurance might be fine for some homes but insufficient for others. If the maximum dollar limit is too low, your home may be at risk. Consider another provider that can fully insure your home or consider an excess coverage policy that extends your coverage limits.
Do You Need Flood Insurance?
In flood-prone areas of the Garden State, your lender may require flood insurance before funding the loan. In this case, you’ll need to buy coverage. However, in other areas, flooding isn’t common or only happens occasionally. It can be tempting to pass on flood insurance if your home is in a lower-risk area, but FEMA reports that more than 20% of flood claims come from areas outside of high-risk zones. The Insurance Information Institute also reports the average flood insurance claim at nearly $43,000.
Because flood insurance rates consider risk, you’ll pay less for coverage if your home is in a low-risk area. This makes flood insurance an affordable way to protect your home even if flood risks are lower.
Choosing the Best Flood Insurance in New Jersey
One of the things that makes New Jersey a great place to live (water) can also make NJ a risky place to own a home. Fortunately, Garden State homeowners can now choose from a number of private market flood insurance companies in addition to standard NFIP coverage. Treat yourself to lower rates as you protect your home against floods. Get some quotes and compare coverages to see how much you can save.
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