With the ability to pick and choose their risks, private carriers will almost always be less expensive.
The National Flood Insurance Program (NFIP) puts everyone in the same pot and will take anyone (for a rate) if the community participates. This is the primary cause of exorbitant rates. However there are times when the NFIP is less expensive.
Private Carriers offer far broader coverages than the NFIP; Private carriers have appurtenant structure coverage as well as additional living expenses. Private carriers offer replacement cost on contents and will insure the contents in your basement.
With Limits up to $5,000,000 with private carriers and only $250,000.00 with the NFIP you will often eliminate the need for an excess coverage policy.
Definition of Flood
The NFIP requires 2 acres of inundation or 2 properties to be flooded. Private Markets do not.
Shorter Waiting Times
Private Carrier coverage becomes effective 15 days after policy inception. With the NFIP it is 30 days.
Both have exceptions for the closing of a loan.
Private Carriers are not available in all areas. Private Carriers come and go. Private carriers can non-renew you.
The NFIP is available in every participating community in the United States. They will not non-renew you.
The NFIP may be the only program available to you.
Most private carriers have a single set of rates and you must meet their underwriting requirements or you will be declined.
The NFIP for the most part rates based on elevation and flood zone location. You will not be declined.
Disclaimer: The above statements are general. Each private carrier has their own set of rules. Not all carriers offer the same coverages.