Flood Insurance – 10 Facts You Have to Know
About 75,000 Americans are now affected by floods each year. Whether or not this is man-made, one thing is for sure: you can safeguard yourself through flood insurance.
Below are ten flood insurance facts that you absolutely have to know:
No place is 100% safe from floods.
Many people think flood insurance is only for people living in “flood zones” or near bodies of water. Truth is, anywhere it rains or snows, or any place with malfunctioning or inadequate drainage infrastructure, is not safe.
Flood insurance is offered everywhere.
Many people think that just because their area rarely gets flooded, they can’t buy a policy. They need to know that no matter their location, there are many offline and online insurance providers that can offer protection.
Floods won’t be covered by your homeowner’s policy.
As a non-renter, you probably have homeowner’s insurance, especially as a requirement of your mortgage lender while you’re still paying off your loan. But because this type of policy will not protect you against floods, you’ll have to buy a separate one.
Flood insurance is one of the most affordable insurance policies available. For instance, you may only have to spend $500 annually to insure a property worth $60,000-70,000.
Discounts are given to low-risk policyholders.
If you live in a place with low susceptibility to floods, your policy can even be cheaper – imagine a couple hundred dollars yearly if you own your home and under a hundred if you’re renting it.
There’s a waiting period (as with most other insurance policies).
In most cases, a flood policy will have about a 30-day waiting period before protection is provided. Insurers need to protect themselves from those who get coverage when a flood is looming.
Flood insurance works for businesses too.
If you’re a business owner with expensive assets housed in a non-residential building, flood insurance can offer you protection for these. Safeguarding such assets can mean coverage worth up to a million dollars.
Flood insurance is q requirement in some locations.
If you live in a flood-prone area in a financed a property, you may have to purchase flood insurance as a requirement of your lender. Obviously, they need to protect the house in which they have equity.
Flood insurance is adaptable.
Flood insurance has no fixed rate and can instead be purchased based on the value of the assets you want to protect. Larger value means larger premium.
Federal disaster relief is hardly sufficient – if at all given.
Finally, the federal government may bring relief during floods, but only after the president has actually declared the incident a federal disaster. The sad thing is, this declaration is only given about 10% of the time, leaving most flood victims to their own devices.
Floods are a serious threat to life and property, so protection is always worth the money spent on insurance. However, policies and insurance companies can differ widely, so go through your options thoroughly before making a choice.