Flood insurance is more important in 2021 than ever due to rising sea levels and increasingly torrential storms. For this reason, we have compiled a list of our most important flood insurance facts to help you prepare as much as possible for whatever the weather brings us! Read on to learn more about this important facet of coverage that may become invaluable as the year gets rainier.
- Flood damage is both the most common and the costliest type of damage. Many people assume that hurricanes cause the most financial loss due to the severity of their damages, but hurricanes only make landfall every so often and only impact a limited portion of the country. Flooding happens year-round nationwide due to circumstances such as rising rivers, early snowmelts, and storms.
- Homeowners insurance does not cover flood damages, which means that you must explore other avenues to stay protected from these harmful circumstances! The National Flood Insurance Program offers flood protection to over 19,000 communities throughout America, which includes coverage for damage to structures and flood-related erosion.
- Inland states need flood insurance just as much as coastal states. Between 1978 and 2007, five of the top twelve states with amount of years in which claims exceeded premiums were all in the Midwest. These included Illinois, Iowa, and even North Dakota, showing that flooding does not only affect states facing the ocean but also every other one as well.
- Costs of flood insurance packages vary largely based on location. For example, this coverage can be very inexpensive in low-risk areas. Conversely, be prepared to pay a premium if you opt for the highest possible coverage in high-risk areas, which are defined as having at least a 25% chance of flooding during a 30-year period. This protection will prove utterly invaluable in the event that your home floods.
- Homeowners are only required to purchase flood insurance if they satisfy three specific criteria. First, their home must be in a flood hazard area where there is a 1% chance of flooding any given year. Secondly, your community must participate in the National Flood Insurance Program. Thirdly, and finally, you must also be refinancing your home using a loan from a federally regulated financial institution. Only then will you be required to own flood insurance.
- Flood insurance can be purchased at any time of year, though it will not be effective until the completion of a 30-day waiting period after your first premium payment. This is a preventative measure against those who only purchase flood insurance hoping to cash in when flood damage is imminent. Be prepared and know that you need to purchase your coverage well in advance of disaster.
- Flood insurance usually covers two areas, both of which are equally important, and those are building property and personal property. Building property coverage will cover the cost of repairs to your home after it is damaged by flooding, while personal property coverage will cover the cost of damages to personal belongings. Given that flooding will inevitably impact some of the items inside your household, as well as the home itself, it is crucial to have coverage for both areas when the time comes.
Now that you are equipped with this surface level knowledge of flood insurance, the onus is on homeowners to do even more research and find the right flood insurance plan for their family before the weather brings severe rainfall. By taking a look at your risk levels and the cost of insurance, it should be easier than ever to determine whether or not you need flood insurance and how to best find the perfect policy. Contact our team at Demont Insurance Agency if you need any help going over your flood insurance options, our markets offer the leading insurance products and programs, and we will make sure that you get exemplary customer service while also receiving coverage to protect you and your home for the future.
