The Importance of Flood Insurance

August 31, 2007
Courtesy of USAA

Record flooding in Ohio last week was a startling realization to many military personnel of the threat floods pose to homeowners at anytime, anywhere. Every state in the US has suffered flooding, and according to FEMA, there’s a 26 percent chance of experiencing a flood during the life of a 30-year mortgage. Compared to only a nine percent chance of fire, flooding is a much more imminent danger to homeowners. Acting upon the threat of flooding before its too late is the best decision military personnel can make.

You can take out flood insurance on your home if your community is part of the National Flood Insurance Program (NFIP). Look for your community in the NFIP Community Status Book on FEMA.gov.

Don’t wait until it’s too late. Flood coverage, which is backed by the NFIP, proves inexpensive compared to what flooding can do to you and your family’s lives and home. Most flood policies have a 30 day waiting period before coverage is effective. To see what just a few inches of water can do to your home watch FloodSmart's interactive demo.

Flood Insurance FAQs:

Why purchase flood insurance?
Floods are the most frequently occurring natural hazard. Purchasing flood insurance is a simple way to protect yourself in the event of a such a disaster.

Does my homeowner’s insurance cover flooding?
No, flood damage or other surface water backup is not covered by typical homeowners insurance policy.

Do I have to purchase flood insurance?
You must have flood insurance to qualify for federal aid if you have received aid for a previous flooding. Also, a flood insurance policy is mandatory if your mortgage is federally backed and your home is in an area at high-risk for flooding.

Will the US Government help me if my home is affected by flooding?
Maybe. If the President proclaims a flood a disaster, then you may be eligible for financial aid, but the aid often comes in the form of a loan (with interest), and will not put your mortgage payment on hold.

How is a flood defined by insurance policies?
• The overflow of inland or tidal waters
• Unusual and rapid accumulation or runoff of surface waters
• Mudflows on normally dry land

What do flood insurance policies cover?
• Structural damage
• Furnace, water heater and air conditioner
• Floor debris clean up
• Floor surfaces such as carpeting and tile

How much does flood insurance cover?
• Homes for up to $250,000 and personal property in your home up to $100,000.
• Personal property for up to $100,000 on rental properties.
• Non-residential property for up to $500,000

How is flood risk determined?
FEMA conducts a Flood Insurance Study (FIS) of a region to identify the community's risk levels. The FIS includes statistical data for river flow, storm tides, rainfall, topographic surveys, as well as hydrologic and hydraulic analyses. After examining the FIS data, FEMA creates a map delineating the different areas of flood risk.

What are flood zones?
Flood zones are land areas identified by the Federal Emergency Management Agency (FEMA). Each flood zone describes that land area in terms of its risk of flooding. Everyone lives in a flood zone - it's just a question of whether you live in a low, moderate or high risk area.

Do I need to purchase flood insurance if I live in a low-risk zone?
It’s always a good idea to buy flood insurance. Almost 25% of all flood insurance claims come from low-risk area zones.

For more information on flooding and insurance, visit www.floodsmart.gov.