February 23, 2024
Florida's Neptune Flood Insurance: the FEMA alternative
In two years, Jim Albert's flood insurance company has signed 15,000 policies in 37 states.


Florida's Neptune Flood Insurance: the FEMA alternative

Art Levy | 9/25/2019

Neptune ditches FEMA’s elevation maps and instead relies on its own analytics and algorithms.

More than 30 years into a career working mostly in data analytics and information technology, Jim Albert decided to start a company. He saw opportunity in flood insurance — an industry dominated by the federal government’s National Flood Insurance Program (NFIP) — and co-founded St. Petersburg-based Neptune Flood Insurance in 2015.

The company, which uses data analytics and algorithms to determine which properties to cover and how much to charge, has written 15,000 policies in 37 states, including Florida, over the last two years.

Neptune touts itself as a high-tech, customer service-focused alternative to the FEMA-backed NFIP, which covers about 96% of the nation’s 5 million homes that have flood insurance. Neptune is backed 100% by reinsurers who are rated at least A/Excellent by A.M. Best.

How It Works: Neptune compiles data from public records that it needs to determine whether to cover a property. Neptune doesn’t rely on the elevation maps used by FEMA. It uses more accurate land survey maps created in part with lidar — a laser radar technology also used by NASA and the military.

“Under the NFIP, you answer 54 questions and then someone has to come out and inspect your house and 30 days later, no sooner, your policy can start,” Albert says. “What we try to do is the exact opposite. You provide me an address. We immediately do a call out to public sources. We pull the data in. In less than 2 minutes, you can have a quote for flood insurance, and you can buy your policy.”

Minding the Gap: Of the 5 million homes in the U.S. that have flood insurance, an estimated 1.4 million are in zones where residents aren’t required to purchase flood insurance. Albert points to some recent storms — Hurricane Harvey, which dumped more than 50 inches of rain on Texas in 2017, and Hurricane Florence, which dumped 36 inches on North Carolina in 2018 — as examples of why he thinks the flood insurance industry is primed for growth.

“Seventy percent of the people who were flooded by Harvey did not have flood insurance, and more than 70% of the losses from Harvey and Florence were in zones where flood insurance was not mandatory,” Albert says. “We think, based on the numbers we've run, there are somewhere on the order of 30 million homes that are in these non-mandatory zones that are at risk. So you’re talking 1.4 million homes actually having insurance and 28.6 million that don't. This coverage gap is a big thing we’re working on. A 2017 study that came out right after Irma stated that there are 1.45 million homes in Florida coastal counties that are uninsured for flood. That's a huge number.”

High-Profile Help: Sensing the growth potential of the flood insurance industry, Trevor Burgess, founder and former CEO of St. Petersburg-based C1 Bank, led a $2-million investment in Neptune in 2018.

“Flood insurance is so critical, especially in light of climate change, and (it) has been so hard to buy,” says Burgess, now chairman of Neptune’s board of directors.


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