Flood Insurance

Flooding is one of the most common causes of property damage in the US. Water damage is difficult and expensive to fix and devastating to your property, and potentially a significant health risk. It can weaken the foundation of your home, cause mold to grow in your walls, cause your paint to bubble and peel, make your drywall crumble and none of it’s covered by homeowner’s insurance.

Homeowners insurance will typically cover water damage from another source. Burst pipes?Covered. Overflowing sinks or bathtubs? Usually covered. Rain damage? Should be covered. Damage caused by sewage backup? Gross, but your insurance company probably has your back. However, flooding, which someone could easily assume would be under the same umbrella as storm damage, is not covered.  

Which means flood insurance is its own separate entity. Flood insurance is administered by the federal government. That means You can only get flood insurance from insurers that are a part of the National Flood Insurer Program (NFIP). Your insurance provider may not participate in the NFIP program if it doesn’t you may need to either contact an NFIP center for a referral or do a google search.

The rate of flood insurance is also set by the government and not by insurance providers. The rate varies dependent upon risk. This means that the rate of your flood insurance would depend upon the flooding risk inherent of your geographic location. The premiums for low risk areas cost around $405 annually, there are some variations depending on whether or not the property has a basement; there’s also a surcharge that changes depending upon whether the property is a primary or secondary residence. In high risk areas, the same coverage can cost around $2,500. There are government run websites that can give you an estimated rate.

You also can’t just buy flood insurance for that single nasty looking storm or hurricane that all the weather channels are talking about. There is a 30-day waiting period in the majority of cases. So technically you can buy it for a nasty looking, incoming storm season.

So, now for the real question. Should you get flood insurance? The decision might actually be out of your hands. Some mortgage lenders might require you to buy flood insurance if you live in a special flood hazard area. Which at least means that if the structure of your home is damaged by flood water, your utilities are affected, if your appliances are damaged, if your flooring gets messed up, any installed or built-in fixtures get damaged, if secondary structures on your property incur damage, or anything happens to valuable personal items worth up to $2,500, you are covered for that. You can get extensions for other items added on your insurance to cover more valuable items.

If flood insurance isn’t mandatory for you, first congratulations, mandatory anything is usually unpleasant. However, like I said at the beginning, flooding is one of the most common causes of property damage in the US. According to the “Insurance Information Institute,” more than one-fifth of claims for flood damage are from moderate to low-risk areas, areas not required to buy flood insurance. So, it is at least worth looking into.

Delana Cotton servers the north east Atlanta region that includes Dacula, Winder, Lawrenceville, Buford, Snellville, Conyers and surrounding areas. Delana treats every transaction as if she were you, the buyer or seller. If you have a real estate transaction on the horizon, meet Delana for a no pressure chat over coffee.