There’s a lot that your typical homeowner’s insurance policy will cover—fires, hurricanes, lightning strikes, and other disasters. But floods aren’t one of them.
The problem is floods are the “most common and costly natural disaster,” according to the Insurance Information Institute, which says that 90 percent of all natural disasters involve some kind of flooding. Over the last four decades, flood-related damage has caused over $260 billion. It doesn’t take much: just one inch of water in your home could cost you $25,000.
Homeowner’s insurance will cover you if a pipe bursts or a water tank starts leaking. But you’re out of luck if the water is coming from outside your house. That means that any flooding caused by a tidal surge or any freshwater sources, like a lake or stream, is not covered by your homeowner’s insurance.
Flooding can happen if even you aren’t that close to a big lake or ocean. In 2017, over half of the homes that were flooded during Hurricane Harvey weren’t in the flood-risk regions, according to Policygenius. Other areas where Policygenius recommends you should consider getting flood insurance:
An area prone to forest fires: The loss of trees and underbrush means there’s nothing to absorb water.
A highly developed area: Lots of pavement—new roads and extensive parking lots—without natural areas also limits the ability of floodwaters to be absorbed by vegetation and soil.
A region that experiences rapid snowmelt: In the United States, these areas often are high-desert regions in the west. However, here in northern New England, we’re no strangers to the risk of flooding due to rapid snowmelt, as Foster’s recently reported.
Private flood insurance usually comes in three forms, according to Policygenius. One form is a standalone policy, which would cover both damage to your home and the loss of personal possessions. Another is an excess policy that covers what isn’t covered by the National Flood Insurance Program. Alternatively, you can get flood insurance added as an ‘endorsement’ to your existing homeowner’s insurance policy. This would result in a modest increase in your premium, but it also would have limited coverage. One further advantage of private flood insurance is that it picks up the living expenses you incur while staying elsewhere.
At the Insurance Center, we offer flood insurance. Call us today at one of our main offices for more information.
Sources Included: Insurance Information Institute, Policygenius, The Balance, Investopedia, and Consumer Reports.