New Jersey Flood Insurance General Information

Flood insurance most likely will be required if you purchase a property using a mortgage. Mortgage lenders typically require a buyer to obtain flood insurance before closing on a property.

If you purchase a home without a loan, there is no law requiring that you have it, however, most homeowners own a flood insurance policy on island (for good reason).

Flood insurance in New Jersey is based on the specific property’s risk of flooding. Multiple factors determine this such as; the flood zone, height of the first floor above base-flood-elevation (BFE), the number of flood vents, and more. Flood insurance can be more affordable than one may imagine, especially if your property is above BFE. On average, flood insurance costs about $1,200-$1,500 a year in Beach Haven, NJ (elevated homes). It is always recommended to speak with a local insurance agent to help determine an accurate quote based on your property and its location. Local insurance agents tend to have better rates and knowledge when compared to those “out-of-town”.

Yes, you can. In general, you will not be denied flood insurance on LBI, however, it is important to keep in mind this likely will come at a cost if your property is below the base flood elevation (BFE). It is important to obtain an elevation certificate in order to easily qualify for a policy and determine your premium. I have often found owners surprised that their flood insurance is not as high as they believed since their home (which is not raised) is actually above or at BFE. It is important to remember that natural ground elevation is factored into the first floor elevation when compared to BFE. For example, taking a property in a zone with the BFE of 9 feet, if the natural ground elevation is 5 feet above sea level and the height from the ground to the first floor is 6 feet, then your property is 2 feet above the BFE.

A flood zone is a specific area that has been mapped by the Federal Emergency Management Agency (FEMA) based on its risk to flood. By definition it is an area that will be inundated by the flood event having a 1-percent chance of being equaled or exceeded in any given year. The 1-percent annual chance flood is also referred to as the base flood or 100-year flood. Long Beach Island has multiple flood zones, however, they can mostly be categorized into “A” zones and “V” zones.

“A” zones- can be labeled as A, AE, AH, AO, A99, and AR. These zones are deemed to have a 1-percent chance of flooding each year. These zones are typically less expensive to insure than a property in a “V” zone.

“V” zones- Corresponds to the 1-percent chance of flooding each year including the hazards associated with storm waves. Most “V” zone properties are oceanfront homes on LBI. Since there is an extra risk of storm waves, insurance in this zone is on average greater. Nevertheless, since many of the oceanfront properties are newer builds and up to current code, the construction requirements have elevated homes in such a way that insurance could be less than expected.

If you are buying a home on LBI, chances are the property is in a flood zone. Determining which zone your property in is actually very easy! There are two ways to do it.

1. Ask me!

2. Search your address in the FEMA flood map.

Yes, unfortunately you do. Like flood insurance, if you purchase a home with a mortgage your lender will require you to obtain homeowners insurance. It is important to understand that homeowners insurance does not cover you for damages caused by the rising of a body of water. There are only certain cases where homeowners may cover water damage, but this would be due to a scenario such as broken pipes. When discussing with an insurance provider, make sure you understand what the flood insurance policy covers and what it does not.

It's a good idea to get flood insurance as soon as you know you’re purchasing a house in a flood-prone area or if your lender requires it. Ideally, you should secure flood insurance at least a month before closing on the house. This is because many policies, including those through the National Flood Insurance Program (NFIP), have a standard 30-day waiting period before coverage takes effect. Planning ahead ensures that your home is protected from potential flooding as soon as possible after closing. If you’re buying a home with a mortgage, check with your lender for any specific flood insurance requirements they may have.

If you’re buying a home with cash or no financing, it is important to make sure you are aware of the 30-day waiting period for it to take effect. Private flood insurance may have a shorter waiting period and better rates. Speak with your insurance advisor to figure out what is best for you!