Greetings, valued customers!
With the 2020 Hurricane season right around the corner, it’s important to emphasize that homeowner’s insurance does not cover flooding. Also, successfully avoiding flood damage in the past does not necessarily predict how your home will fare in future flood events.
If you would like to look at flood insurance options, I would encourage you to do so right away, as all new flood policies come with a 30-day waiting period before coverage goes into effect.
To help you make the most informed decision possible, please review some of the most common myths regarding floods, and flood insurance, below.
Facts and Myths about Flood Insurance
MYTH: My homeowner’s insurance provides coverage for damage caused by a flood.
FACT: Homeowner insurance policies do not typically cover flood damage. That is why the federal government backs the National Flood Insurance Program (NFIP). You can purchase flood insurance through an independent insurance agency, or directly from a carrier.
MYTH: My homeowner’s insurance agent understands whether or not I need flood insurance.
Not necessarily. Not all insurance agents are familiar with communities that participate in NFIP or floodplain hazards.
However, it is in your best interest to check with an agent who is knowledgeable about NFIP, and who can explain the benefits so your home and property will be adequately covered should a flood occur.
If your insurance agent tells you that you don’t need flood insurance, it’s best to check with the NFIP. For more information, go to www.fema.gov/national-flood-insurance-program or contact the NFIP call center at 800-427-4661.
MYTH: Only those who live in a Special Flood Hazard Area (SFHA) can buy flood insurance.
FACT: Anyone can buy flood insurance if they live in a participating community, which must enforce floodplain ordinances and building requirements that meet or exceed FEMA guidelines.
If your community does not participate in the NFIP, you can make a request through your mayor, city council, or county commissioner’s office.
MYTH: It doesn’t make sense to pay for flood insurance if you live in a low-risk flood zone.
FACT: People outside of high-risk flood zones file more than 20 percent of all NFIP claims and receive one-third of federal disaster assistance for flooding. Flooding can occur anywhere. In fact, it is the number one natural disaster in the United States.
The NFIP’s Preferred Risk Policy is very affordable and can help prevent a lot of headaches (physical and financial) in the event of a loss. The premium for a primary residence may cost about $467 a year for $200,000 of coverage for a home structure, and $80,000 for contents. That is less than $40 a month.
MYTH: I don’t need flood insurance if I can get disaster assistance from FEMA.
FACT: A flooding incident must be declared a federal disaster by the president before FEMA assistance becomes available. Federal disaster declarations are issued in less than 50 percent of flooding events.
If a declaration is made, federal disaster assistance typically is available in the form of a low-interest disaster loan, which must be repaid. Any grants provided are generally not enough to cover all losses. NFIP pays for covered damage whether a federal disaster declaration has been made or not, and may cover more of your losses.
MYTH: Even if my property floods, it won’t be by much.
FACT: Just five inches of water can cause $11,000+ worth of damage.
MYTH: You can’t buy flood insurance right before, or during, a flood.
FACT: You can purchase flood insurance at any time, as long as your community participates in the NFIP. However, there is usually a 30-day waiting period after the premium payment before the policy becomes effective.
Contact the NFIP call center at 800-427-4661 if you are told you cannot purchase flood insurance.
MYTH: Flood insurance is only available for homeowners.
FACT: Most people who live in NFIP participating communities, including renters, condo owners, and businesses, are eligible to purchase flood insurance.