YOU Are in a Flood Zone!

Posted by Matt Simon on Mar 7, 2014

Do you think a flood could never happen to you?  Are you saying to yourself “I don’t live in a flood zone”?  Guess what?  Everyone lives in a flood zone.  It’s just a question of whether you live in a low-risk area or a high-risk area.  And consider this:  while flood insurance is required for those living in a high-risk area, people outside of high-risk areas file over 20% of flood claims.

Here are the most common myths we hear when discussing flood insurance with our clients:

I already have homeowners insurance so I’m covered.
Homeowners insurance does not cover damage caused by a flood.  However, it does cover fires.  Now consider this, in a high-risk area, your home is more than twice as likely to be damaged by a flood as by a fire.

Why pay for flood insurance when disaster assistance is offered after a flood?
Not necessarily the case.  Disaster assistance is available only when the president declares a disaster, and even then, disaster assistance is usually a loan that you repaywith interest!  For a $50,000 loan at 4% interest, your payment would be around $2,880 per year for 30 years, IN ADDITION to your mortgage loan that you still owe on the damaged property.  PLUS, you would need to buy and maintain flood insurance for the life of the loan.

I live on a hill so I’m not at risk.
If you live on a hill or in an area that has never been flooded, your risk may be significantly reduced, but it’s not eliminated.  Aside from major storms, flooding can be caused by heavy rains, melting snow, and inadequate or clogged drainage systems.

Ohio Flood InsuranceFlood insurance is too expensive.
The average flood insurance premium is about $600 per year – $50 a month.  If you live in a low-risk area, you may qualify for a Preferred Risk Policy with a premium starting at $129 per year.  Considering that even a few inches of water can cause tens of thousands of dollars in damage, the annual premium can be well worth the financial protection it provides.

In fact, the greatest expense could very well be not having flood insurance when you need it.

 My area has never flooded so I’m sure a flood won’t affect me.

The fact that a flood has not occurred recently doesn’t mean one has not happened in the past or that one will not happen in the future.  Flood history is just one element used in determining flood risk.  Other factors include rainfall data, topography, wind velocity and building development in your area.

Flood insurance does not cover contents in my basement.
Contrary to what many believe, flood insurance does provide limited basement coverage.  Though it does not cover finished walls, floors or ceilings, or personal belongings, it does cover structural elements, essential equipment and other basic items normally located in basements.  Imagine the costs associated with replacing the items listed below:

  • Furnaces, water heaters, air conditioners and heat pumps
  • Electrical junction and circuit breaker boxes and required utility connections
  • Unpainted drywalls and drywall ceilings, including fiberglass insulation
  • Foundation elements and structural support equipment
  • Sump pumps
  • Well water tanks and pumps, cisterns, and the water in them
  • Oil tanks and the oil in them, and natural gas tanks and the gas in them
  • Pumps and tanks used in conjunction with solar energy
  • Stairways and staircases
  • Washers
  • Dryers
  • Freezers & food contained in them

Adding flood insurance to your protection portfolio is simple, just give us a call or Request a Proposal.  It’s important to remember though, flood insurance policies have a 30-day waiting period from the time you apply and pay for your policy so if you’re thinking of waiting until the storm is approaching to buy your policy, it’s likely too late!  Don’t wait until after the storm warnings to buy flood insurance.

Source: NFIP

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Category: Homeowners Insurance (2), Flood Insurance (2)

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