Ryan Insurance & Financial Services
Aug 28, 2018
As we move further along into hurricane season, it’s important to take some time to make sure that you have the proper flood coverage in place. Typically, the most active hurricane months are August and September. In previous years, a number of our clients contacted us to request last minute primary and/or excess flood insurance when a storm was impending. Unfortunately, due to insurer-imposed biding restrictions, we were unable to secure many of these last-minute policies before the storm hit.
We don’t want this to happen to you. We want to make sure that you’re prepared this storm season, so you can avoid a stressful and financially devastating situation. Below you’ll find some information that can help you stay informed about flood insurance and make sure that you are properly protected.
FLOOD INSURANCE 101
Flood insurance is not covered by a homeowners’ insurance policy. Often homeowners are told by lenders and real estate agents that their home is in a “preferred flood zone” and they assume that means it’s “not in a flood zone.” The reality is that all properties can flood even if a lender doesn’t require flood insurance for the purposes of a loan.
Flood insurance is important for all homeowners’ regardless of where they live. We highly recommend all homeowners carry flood insurance as 25% of all floods happen in low-risk areas. And, considering 90% of all natural disasters include some type of flooding, it can happen to anywhere.
Understanding what flood insurance covers/doesn’t cover can ensure you’re properly protected. Flood insurance covers the cost to rebuild your home and contents. However, flood insurance purchased through the National Flood Insurance Program (NFIP) has very limited or no coverage for basements, valuable possessions, other structures and replacement cost on contents. It also does not include additional living expenses. There are other options available with private market insurers that can cover many of the things the NFIP does not and more.
Buying and maintaining flood insurance now will help protect homeowners financially from storm damage. Typically, a policy does not take effect until 30 days after the date of purchase. This can vary depending on your insurer, but we recommend being protected before a storm hits.
Excess flood coverage is beneficial for homeowners living near a large body of water. If a home is in a high-risk zone, homeowners should look at the potential damage a flood could cause. If the home is near a large body of water, especially if there is a levee or dam, homeowners should consider excess flood. This adds an additional layer of flood insurance protection above the NFIP maximum policy limits of $250k dwelling and $100k contents. In high-risk areas, there is at least a one-in-four chance of flooding during a 30-year period.
Contact your Ryan Advisor today if you have any questions or want to discuss your flood insurance options.