A Few Things to Know About Flood Insurance

The past few years have brought a series of high-profile storms to coastal regions, from the Gulf all the way up to the mid-Atlantic and New England. From hurricanes making landfall to dramatic blizzards, the weather has been anything but predictable. If you live in an area that's prone to flooding – or even if you don't necessarily live in a flood plain, protecting your property with flood insurance might be more vital now than ever.

Whether your home is situated on the coast, the banks of a river, or a low-lying area where your basement is likely to take on water if your sump pump fails, not having insurance could mean the difference between a total recovery and thousands of dollars in property loss or water damage remediation. If you're moving into a new home, it's important to understand whether the area is prone to flooding or has flooded before. You should also review your homeowner's insurance policy carefully. While homeowner's policies don't usually cover flooding, it's good to know what types of damage your policy does cover.

What is flood insurance? Supplementary to a homeowner's policy, flood insurance is extra coverage purchased through the National Flood Insurance Program expressly for protection of your property and belongings should your home be damaged by flooding. Obviously, premiums for this insurance are higher in areas deemed high-risk for flooding, while low-risk areas carry lower premiums.

How do I know if I am in a flood-prone area? Flood insurance rates are determined by rate maps created by the Federal Emergency Management Agency (FEMA) and are designed to reflect the level of flood risk in a given area. These maps are available online through the NFIP and can give you an idea of the risk of flooding in your area. Maps are continually updated as changes occur within a community. Your insurance agency should have a current picture of the flood risk in your area.
If my risk seems low, why might I need flood insurance? According to FEMA, while some areas are at lower risk for flooding, any area of any community is susceptible at some level; just because your community hasn't flooded before doesn't mean that it won't. Poor drainage, snow melt, unexpectedly heavy or ongoing rains, or changing topography due to natural or human causes can change your flood risk at any time. It's important to remember that if you are not covered by flood insurance, it will be much more difficult to recoup any losses due to flooding and water damage. Lower-cost policies called Preferred Risk Policies may be available for homeowners living in low-risk areas.

As with all insurance policies, flood insurance is a safety net designed to protect homeowners from unexpected damage to their homes. Homeowners without such insurance who find themselves in the midst of even an unlikely or unexpected flood could face paying for damages out of pocket. Talk to your real estate agent and to your insurance company when you make a move to a new home. These professionals will be able to guide you in making a decision about whether obtaining flood insurance is the right decision for you.