Please assist me with this. Allstate Insurance is interpreting FEMA guidelines to its benefit for flood insurance policies and taking money from customers like me, to the tune of $1200 in my case, rather than providing a lower rate, which is available through other companies interpreting the same guidelines. Something is wrong with the fact that consumers cannot cancel flood policies based on FEMA's assumption that its guidelines render the same quotes regardless of company.
My specific case:
August: As part of refinancing my home, I was made aware that I was paying an outrageous amount of money for my flood insurance policy with Allstate (annual premium $1608.00).
August: I obtained an elevation certificate for my property so it could be used to obtain another, more affordable flood policy.
September: I requested cancellation of my flood policy with Allstate and paid for a new policy with Fidelity in the amount of $453.00.
October: I inquired with Allstate as to the status of the cancellation and was informed they needed the declaration page from the Fidelity policy. I took this in person and was told I would get a prorated refund in a few weeks.
November: I received a letter from Allstate stating the policy could not be cancelled, per their underwriting department (800-527-2634).
December: I changed agents, thinking a new agent would bring some sense into the situation. I was informed that, per FEMA regulations, flood insurance policies could not be cancelled. Quotes for these policies are to be calculated on the elevation certificate of the property and adhere to FEMA guidelines available to all underwriters. I provided Allstate with the elevation certificate that Fidelity had used (an elevation certificate had not been on file with Allstate recently) and also provided updated pictures of the property, as per their request.
January: I received word from Allstate, through the new agent, that their rate was still $1,608, and that Fidelity must have made a mistake on their quote.
January: I contacted Fidelity and had them explain to me how they arrived at my quote, and was told that they had taken additional steps based on FEMA guidelines, based on the year my property was constructed and other details. They confirmed their quote was correct and suggested I share their declaration page with the underwriting department at Allstate so that they could do the same.
January: I contacted the new agent and asked him to fax the declaration page to their underwriting department, which he did. After a few days he contacted me to say that the underwriting department would not make any changes and that the quote stood at $1608.00.
If FEMA regulations that prohibit my cancelling with Allstate are in place because quotes are to be based on their guidelines and allowances, along with a property elevation certificate, why am I out $1200.00? If there is going to be such disparity in quotes, I should be allowed to cancel a policy. Allstate knows that if they adjust my rate, they will have to give me the additional money I have paid them. They also complacently explained that I could simply switch companies in June when the policy expires and go with another company then. Well, this works out in their favor because they keep my money.
February: I took the time to ask six of my neighbors on my block to tell me how much their insurance policy premium is. All of them pay in the area of $400.00 to $450.00. I wonder how many other people Allstate Insurance is also doing this to, while reaping the financial benefit of such an act.
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