Flood Insurance

Why Get Flood Insurance?

Flooding is very loosely defined as any excess of water (or mud) on land that is normally dry. Flash floods, when a large amount of rain falls in a short amount of time, can happen anywhere. In fact, according to the National Flood Insurance Program (NFIP), about 25 percent of policies paid out are in low-risk areas.

Some people believe that the federal government will provide assistance if they are victimized by a flood. However, federal assistance only comes if the President declares a region a disaster area. Even then, most assistance comes in the form of a loan that has to be repaid. When you have flood insurance, on the other hand, you do not have to pay back the money you receive. Even an inch of floodwater can cause extensive damage to a home or business, and in that case, disaster money will not be available.

To get flood insurance that is backed by the NFIP your community must participate in their program. If your community does not participate, contact your local government officials to see what can be done.

Flood insurance is available through almost 200 companies, including:

• Allstate
• American Family
• First American
• Prudential
• State Farm

Because flood insurance is backed by the NFIP, all rates are the same. Select your company based upon their reputation and the quality of service they offer.

Kinds of Insurance

Three types of insurance are available: Dwelling (home), General Property (apartments and businesses) and Residential Condominium Building Association (condominiums). Your rate will be based upon your need, along with:

• Where you live
• Amount of coverage
• Age, elevation, and structure of your home/business
• Building occupancy
• Deductible

Two types of coverage are available: content damage and building damage. Homeowners can insure their houses for up to $250,000 and content for $100,000. Renters are not left out. In fact, it is a good idea to purchase a flood policy if you rent. Renters' belongings can also be insured for up to $100,000.

Most building policies will cover structural damage, furnace, water heaters, air conditioners, clean up, and fixing/replacing flooring. Content insurance covers furniture, art, collectibles, electronics, and similar items. Check with your company to find out the specifics.

If you live in a low-risk area, you may qualify for a Preferred Risk Policy. This policy is cheaper to obtain and offers money for both content and property damage in one policy.

On the flip side, federal law may require you to purchase flood insurance if you live in a high risk area. Or, if you received federal assistance for flooding previously, you must have a policy in order to qualify for further aid, should you need it.

After a Flood

After a flood occurs, the NFIP recommends you do several things to make the claim process go smoothly and quickly.

• Call your agent as soon as possible to file a claim.
• Take photos of water damage and keep damaged personal property.
• Check for structural damage.
• Do not use open flames, in case of a gas leak.
• Keep the power turned off.
• Do not use toilets or water until the plumbing has been checked.
• Toss all food, even canned goods.
• Boil water to be used for drinking and food preparation.
• Salvage what you can.
• Follow local building codes and ordinances when rebuilding.
• Protect your property from future damage.

To check out the risk for flooding in your area, visit the NFIP’s flood assessment website. For information by state or region, a list of contacts can be found at insure.com.