Climate change is a hotly debated issue, but no matter what side of the fence you’re on, you’ve witnessed recent flooding disasters across the nation for the past few years, one of which hit Nebraska and Iowa hard in 2019. The Weather Channel predicts spring 2020 could bring a repeat of widespread flooding in the nation’s midsection somewhat reminiscent of last year’s massive event.
Long-range flood outlooks issued by the National Weather Service North Central and Missouri Basin River Forecast Centers said there is an above-average chance of widespread flooding this spring along stretches of the Mississippi River, Missouri River, Red River and other tributaries in the northern and central U.S. Flooding last year along the same areas caused an estimated $20 billion in damage, according to NOAA.
With the ground still saturated from last year’s precipitation, now is a good time to check your homeowner’s insurance policy and consider adding flood coverage if you don’t already have it.
Flood coverage isn’t typically included in a standard homeowner’s insurance policy. If your property is located in an area with a high risk of flooding, opting for flood coverage is generally advised. Flood insurance is mandatory for anyone with a government-backed mortgage whose home falls into a “special flood hazard area” – meaning a risk of flooding once every 100 years.
In the United States, the National Flood Insurance Program (NFIP), provides federally backed flood insurance to communities that agree to adopt and enforce floodplain management ordinances. The NFIP, established in 1968, has about five million policies, providing $1.3 trillion of coverage. While these numbers may seem large, only 15 percent of US households have any flood coverage at all. During 2017’s Hurricane Harvey that hit Texas and Louisiana, 70 percent of the estimated $125 billion in damage was uninsured.
Between 1978 and 2003, the NFIP paid out claims of under $500 million a year. Since then, the claims have averaged $3.5 billion a year.
What does flood insurance cover?
You may think flood insurance is an umbrella policy that can provide complete coverage for any water damage sustained to your home or possessions. It’s important to work with your insurance agent to understand what exactly is covered in your policy. Here is an example of what is typically covered: your home’s foundation, electrical and plumbing, finishings, appliances such as stoves and refrigerators, electronics, and personal belongings.
When determining coverage, the cause of flooding matters. Flood insurance covers losses directly caused by flooding. In simple terms, a flood is an excess of water on land that is normally dry, affecting two or more acres of land or two or more properties.
Being prepared for natural disasters is one of the best things you can do to protect yourself and your home from any potential damages. If you want to know more about flood coverage, just give us a call and we will be happy to walk you through it.