Philadelphia Insurance Cos. believes its models can providebetter prices than the National Flood Insurance Program for someflood-related commercial property risks.

The Bala Cynwyd, Pa.-based member of the Tokio Marine Group isintroducing a new commercial primary flood insurance policy as analternative to businesses that might otherwise turn to the NFIP forcoverage.

“The NFIP is restrictive in the terms and limits they canprovide and their rates are driven by their models,” says NealSchmidt, vice president of underwriting specialty property forPhiladelphia Insurance. “We believe we can provide higher limitsand better terms using our models.”

The NFIP limits coverage on a commercial building to $500,000.Schmidt says Philadelphia Insurance can offer coverage up to alimit of $5 million. Included in the policy is replacement costcoverage for building and contents.

“We will evaluate each property individually, which means we maybe able to provide coverage to a business in a high-hazard floodzone,” he says.

The NFIP might price all policies in a high-risk flood zone thesame. But, for instance, Schmidt says some properties on theoutside edge of these zones can be insured.

Schmidt says Philadelphia Insurance is a supporter of the NFIPand interest in the product is not driven by the federal program'sconsistent threat of lapsing. Rather, clients are looking for“one-stop shopping” and more-accurate coverage terms rather thansigning on with NFIP up to its limit and then trying to find excesscoverage.

Philadelphia Insurance's sister company, WNC First InsuranceServices is underwriting and administering the program. Tokio'sMarine's specialist insurance and reinsurance group Kiln, ofLondon, bought a 49 percent share of WNC a year ago.

WNC says it is in the largest administrator of flood insuranceprograms in the U.S. In 2010 WNC introduced a single-policycommercial flood program to combine building, contents and businessinterruption coverage in one package.