Many people do not realize that floods are the biggest disasters in the United States. According to the Federal Emergency Management Agency (FEMA), flood insurance claims are on the rise. In 2012 the average claim for flood insurance was $42,000 and in this period the average cost of flood insurance was pegged at $650 per year. In 2014 flood insurance claims reached as high as $42,275 and flood insurance is expected to rise as much as 18% in 2016. Here are some things you need to know about flood insurance and disaster preparedness.
Check Flood Insurance Rate Map (FIRM)
The National Flood Insurance Program (NFIP) has a Flood Insurance Rate Map (FIRM) that maps out communities in high-risk places. They also have a tutorial for homeowners which helps them identify flood risks in their home to educate them whether they need flood insurance or not.
Some lenders believe that homeowners have a one in four chance of becoming flooded in a high-risk area during the duration of their 30-year mortgage. This is why they require homeowners to buy flood insurance. There are also lenders that require flood insurance even to those residents in low-risk areas.
Flood Insurance Coverage
Flood insurance covers the building and the contents inside. Flood insurance does not cover the land. Basements and crawl spaces might not be covered by flood insurance. Dwelling coverage can cover up to $250,000 while contents coverage can go as high as $100,000 for personal property. It’s best to purchase both kinds of insurance because homeowners’ policy will not cover flooding.
Examples of building coverage are
- Building and its foundation
- Electrical and plumbing
- Central A/C, furnaces and hot water systems
- Appliances like dishwashers, refrigerators
Examples of Contents are:
- Clothing and furniture
- Freezers and the food in them
- Portable and window air conditioners
What Flood Insurance Won’t Cover
Home owners should also know what flood insurance does not cover. The following things are usually exempt from coverage:
- Currency, precious metals and stock certificates
- Self-propelled vehicles like cars and motorcycles
- Trees, plants, septic systems, decks, patios, swimming pools and other properties outside the dwelling
- Damage caused by mildew, mold or moisture that could have been prevented by the renter.
Who Needs Insurance?
Families or individuals who live in a flood plain or high-risk area should purchase flood insurance even if they have never experienced flooding before. Type of building, contents, whether or not the property has a basement, building construction and elevation are just some of the factors that are considered for insurance rates.
- Always be familiar with what is covered for flood insurance in your home or before purchasing.
- Ask your agent to do a review of your policy’s limits and exclusions so that you know what is covered
- Always have a flood preparedness kit ready if you live in a high risk area. Kit should include emergency food supplies, water, first-aid kit, spare batteries, flashlights, radio and medications.
- Do a full inventory of the house and its contents periodically. Going from room to room with a video camera and taking pictures can provide inventory valuables and works of art.
- Make sure that landscaping does not collect water and drains away from foundation of the building.
- Make sure that downspouts are always clear of debris and drain away from the building or house.