Is Your Property Protected in the Event of a Flood?

The standard insurance policy does not cover things like floods– those require a separate rider policy added on to the basic policy for complete coverage. The question is, are you covered if water starts to rise?

In a March 2013 survey commissioned by Allstate, 44 percent of Americans said they believed they were covered for weather-related floods, when, in fact, only 15 percent reported having purchased a flood insurance policy through the NFIP.  How do you know if you really need this coverage?

There are a couple things to consider in this question. First do you live in a flood zone? Your town offices have the entire community mapped out as to where flood zones are located. Flood maps show areas of high, moderate, and low flood risk as a series of zones. High-risk zones, also known as Special Flood Hazard Areas (SFHAs), begin with the letters “A” or “V.” Moderate- to low-risk zones, known as Non-Special Flood Hazard Areas (NSFHAs), begin with the letters “X”, “B” or “C.” There are also areas where the flood hazard is undetermined, labeled as Zone D.

If you live in a flood zone, or just on the outskirts, then flood insurance should be added to your homeowner’s insurance policy; however, there are other considerations:

• Hurricanes and other storms can cause flooding in areas that do not regularly flood. Those 100-year-floods you hear about are very real. There are many types of conditions that can result in a flood: Spring thaws, heavy rains, hurricanes and the rapid accumulation of rain after a wildfire are just some of them. And, while certain areas are prone to flooding, it can happen anywhere and at any time. According to www.floodsmart.gov, floods are the No. 1 natural disaster in the United States. "Anywhere it rains, it can flood," the federal government-run site declares.
  
  
• The FHA's standard mortgage document, and any other insured mortgages typically require flood insurance based upon if the home is located in or near a flood zone, so you may be required to purchase this insurance in order to secure your mortgage.

Typically, there's a 30-day waiting period from date of purchase until your policy goes into effect, but there are a few exceptions including:

• If a building is newly designated in the high-risk Special Flood Hazard Area (SFHA) and you purchase flood insurance within the 13-month period following a map revision, there is a 1-day waiting period.
  
  
• If you purchase flood insurance in connection with making, increasing, extending, or renewing your mortgage loan, there is no waiting period.
  
  
• If you select additional insurance as an option on your insurance policy renewal bill, there is no waiting period.

Annual premiums for flood insurance on a single-family one-story home average about $400-$450 nationwide, but can be as low as $112 in a low-risk area and more than $2,000 a year in flood-prone areas.

It is essential that you visit with your insurance agent to determine exact costs. Also, read your policy thoroughly and ask your insurance agent questions regarding anything that does not seem clear.