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With hurricane season underway, it is highly recommended that homeowners review their current homeowners policies and carefully consider participating in the National Flood Insurance Program (NFIP), which provides varying levels of flood coverage under the auspices of the Federal Emergency Management Agency, now a division of the Department of Homeland Security. Claims relating to floods and any resulting water damage are government matters treated separately from privatelyinsured wind loss claims that are more commonly associated with hurricane damage.
The NFIP ensures that homeowners and renters in approximately 20,200 participating communities throughout the United States will be eligible for federally-regulated insurance protection in case of flooding, the most common natural disaster in our country. Damage due to floods and flash floods occurs in all 50 states.
Although coastline and waterfront properties are generally considered to be at greater risk of flooding than inland areas, government statistics indicate that one-fourth of all floods in this country – and one-fourth of all flood insurance claims – occur in areas not designated as floodplain.
According to the official government website for the NFIP (www.floodsmart.gov), it covers “devastation caused by storm surge, wave wash, tidal waves, or the overflow of any body water over normally dry land areas.” This includes floods caused by hurricanes and tropical storms, as well as those caused by heavy rains, melting snow, inadequate drainage systems, sewer backups, and failed protective structures such as dams or levees. The NFIP is funded through the insurance premiums paid by its policyholders, rather than through taxpayer dollars.
Premiums are determined by the type and amount of coverage elected, as well as location. Federal flood maps, which are updated periodically, assign flood risk status to all property in the United States by indicating low-risk, moderaterisk, high-risk, Special Flood Hazard Areas.
As program participants, homeowners may insure their primary residences with up to $250,000 of coverage for the structure of their homes, plus up to $100,000 of additional coverage for contents. Replacement costs for any structural damage as the direct result of flooding (up to the coverage limit) would include damage to the foundation of the building, as well as to equipment that is connected to a power source needed to support the structure, such as the furnace, water heater, and circuit breakers. If contents coverage is elected, the separate policy limit would apply to the value (less depreciation) of other household items and appliances damaged or destroyed as a direct result of flooding. Non-residential property owners may cover buildings and contents up to $500,000, and renters can cover belongings up to $100,000.
BWD Personal Lines representatives are thoroughly familiar with the provisions of the National Flood Insurance Program, and would be pleased to assist you in obtaining additional information, as well as any additional insurance coverage you may need. |
