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, as long as you get rain or snow, or your drainage infrastructure is inadequate or not working properly, you’re at risk.
Flood insurance is offered everywhere.
Many people think that just because their area rarely gets flooded, they can’t buy a policy. What they’re unaware of is that no matter where they live, there are many insurers, both online and offline, that are willing to protect them.
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. Remember that this policy will not protect you against floods, so you’ll have to purchase a separate one.
Flood insurance is one of the most reasonably priced policies you’ll find out thee. You can, for example, protect a $60,000 to $70,000 property for only $500 a year.
Low-risk means discounts.
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.
Yes, there’s a waiting period just like other insurance policies.
In most cases, a flood policy will have about a 30-day waiting period before protection is provided. This is a way for insurers’ to protect themselves from those who might apply for coverage when floods become imminent.
Flood insurers also protect businesses.
If you keep expensive assets in a non-residential structure for a business that you own, you can get flood protection for these as well. To protect such assets, a flood policy may provide up to a $1 million coverage.
Flood insurance is required in certain areas.
If you’re financing a property in a flood-prone zone considered, your lender will surely require you to get flood insurance. Clearly, this is to safeguard the home where they have equity.
Flood insurance is highly flexible.
Flood insurance has no fixed rate and can instead be purchased based on the value of the assets you want to protect. The bigger the value, the bigger the premium.
Federal disaster relief is inadequate, if at all provided.
Finally, disaster relief during floods may be provided by the federal government, but note that this is only when the president has declared the situation 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.