Flood Insurance: What You Need To Know

Many new homeowners struggle with understanding what kind of insurance they need to protect their investment. One type of insurance that nearly every homeowner needs is flood insurance. Floods are the number one disaster for homeowners across the U.S. While many people associated floods with raging rivers or coastal storm surges, residents all over the country run the risk of encountering flood damage. For that reason alone, homeowners should examine their flood insurance needs.

Understand Your Flood Insurance Risk

Flood risks around the country have grown to such an extent in recent decades that private insurers have exited the flood insurance market. Instead, the Federal Emergency Management Agency operates the National Flood Insurance Program. FEMA examines topography, climate data, and land use records to determine the flood risk in specific areas. If your home is in an area FEMA considers a Special Flood Hazard Area, your mortgage lender may require you to purchase flood insurance as a condition of the mortgage.

Find Your Flood Insurance Costs

In 2012, the average annual flood insurance premium was $650. A FEMA report shows that the average flood insurance claim between 2008 and 2012 was $42,000. Flood insurance claims payments in 2014 ranged from $10,476 to $42,275, leaving thousands of homeowners in debt for their flood damage. The high number of claims in recent years, as well as budgetary shortfalls in the flood insurance program, have prompted FEMA to increase its flood insurance premium rates by as much as 18 percent in 2015.

Items Your Flood Insurance Covers

Homeowners should be aware of what aspects of the home their flood insurance policies cover. A standard flood insurance policy will protect against damage to the home’s structure and foundation, as well as many of its internal systems. These protections include the electrical, plumbing, heating and air conditioning systems. The policy can also include “contents coverage,” which covers personal property. Protected property can include clothing, appliances, furniture, electronics and valuable items up to $2,500.

Items Your Flood Insurance Does Not Cover

While the typical flood insurance policy covers many of the structural aspects of the home, it does not cover damage to external items. These items can include landscaping, patios, septic systems, swimming pools and hot tubs. Flood insurance policies also do not cover cars, trucks, motorcycles, boats or other vehicles that suffer water damage. If the adjuster finds that the homeowner could have been prevented the water damage within the home, the insurer will frequently refuse to honor those claims.

Source: PropertyCasualty360

Get Answers For Your Flood Insurance Questions

To find out how we can answer your questions about flood insurance lawsuits, contact one of our attorneys today. Our intake team will take down the details of your case and quickly connect you to an attorney who understands how to get the most from your flood insurance lawsuit. You can also fill out the “Free Case Evaluation” form at the top of this page.