Flood Insurance – 10 Facts You Have to Know
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:
Floods can occur anywhere.
People often think flood insurance is only needed in flood zones or in areas that are in close proximity to bodies of water. Truth is, anywhere it rains or snows, or any place with malfunctioning or inadequate drainage infrastructure, is not safe.
Flood insurance is available everywhere.
People tend to think that flood insurance is only sold in areas that are constantly flooded. 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.
Your homeowner’s policy does not cover floods.
Non-renters usually have homeowners insurance, which is often even required if you’re paying mortgage. 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 affordable insurance policies available. For example, to protect a property with a value of $60,000 to $70,000, you’ll probably only spend $500 a year.
Discounts are given to low-risk policyholders.
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.
There’s a waiting period (as with most other insurance policies).
In most cases, a flood policy will have about a 30-day waiting period before protection is provided. This is how insurers protect their interests against those who want coverage when a flood is close at hand.
Flood insurance works for businesses too.
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. Safeguarding such assets can mean coverage worth up to a million dollars.
In some locations, flood insurance is actually a must.
If you’re financing a property in a flood-prone zone considered, your lender will surely require you to get flood insurance. Obviously, they need to protect the house in which they have equity.
Flood insurance is flexible.
There is no fixed rate when it comes to flood insurance, and you can get a policy based on the value of your assets. Larger value means larger premium.
Federal disaster relief is hardly sufficient – if at all given.
Finally, the federal government may bring relief during floods, but only after the president has actually declared the incident 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 real threat to life and property, so getting protection is always worth the cost. Policies and insurers are not all the same, however, so take time to study your options before finally selecting one.