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FLOOD INSURANCE: What Homeowners Should Consider

October 15, 2020

When you hear the word “FLOOD,” what comes to mind? Big storms, hurricanes? Probably.

Tornadoes, torrential East Texas rains? Maybe. Flood Insurance? Probably not.

We’ve all seen the shocking photos and videos of homes devastates by floods. Water levels rising and destroying homes, belongings, and property. One good point to remember is the physical, financial, and emotional toll can be lessened with flood insurance to help cover damage costs.

Floods are regular occurrences in these big natural disasters, but they’re far more common at other times than most people assume. Even if you don’t think your house is at risk, you might be surprised. We don’t like to think about these things happening to us, but the reality is, they can.

Bosworth & Associates Insurance in Tyler, Texas, wants to help you understand why flood insurance is sometimes overlooked, and why your home and property might be at more significant flood risk than you think.

It’s essential for you to be prepared and protect your home, business, and assets, as flood damage can occur without quickly and without warning. But the good news is that flood insurance coverage can help save the day.

According to the FEMA website, more than 20% of insurance claims for flood damage don’t come from high-risk areas.

Spring snow melts, clogged or poorly maintained drainage systems, broken water pipes, dam failures around lakes, etc. can cause property damage and property loss. Rising water levels are making these “unexpected disasters” much more likely.

This is where flood insurance comes in.

No matter what, owning a home is taking a risk. It’s part of the package of being a homeowner—taking on responsibility for a structure, land, and property. Most of that responsibility is financial. However, the purpose of insurance is to help lessen that risk!

Be proactive right away. Before buying a new home or business, always do some research on whether the area is prone to floods. Is it in a flood plain? Is there a lake or dam nearby? How high is the water table?

Talk to neighbors who have lived in the area for a significant period of time. If there’s a big storm, where does the drainage end up? If you have a basement, does it show evidence of previous water damage?

Ask important questions beforehand. It’s much better than asking after it’s too late.

Look into the NFIP—National Flood Insurance Program. If you’re in a high-risk area, flood insurance is required through NFIP if you have a mortgage. Even if it’s not required and you don’t live in a high-risk area, you should still evaluate your flood insurance options.

Statistically, water and flooding are two of the most likely things that could damage your home and property.

Most natural disasters involve some type of flooding.

FEMA estimates show that the cost of only an inch of water damage inside your home or business could cost up to $27,000 or more. Clearly, water damage can be catastrophic and expensive.

One of the first things you should do as a homeowner is look at your insurance policy portfolio. Does it include flood insurance?

Check the fine print of your insurance policy—does your homeowner’s insurance cover flood insurance? What kind of personal protection does it offer? It’s also important to know what’s covered. Does your insurance cover just the structure of your home, but not the contents? What about your car? Your business?

But what if you don’t own your home? You can and should still look into flood insurance even if you’re renting. Rental insurance will help cover the cost of lost property in the event of a flood.

As recent hurricanes have shown us, too many people get caught short and find out too late, after they’ve sustained costly damage. Preparation is key.

One of the tricky parts is that flood insurance, not homeowner’s insurance, is the only type of policy that covers the price of rebuilding your home after a flood. That is why it’s so important to contact your insurance representative and go over what’s covered—and what’s not—in your policy.

The good news is that you can purchase flood insurance at any time. However, don’t wait until the last minute to purchase your flood insurance! Often, this type of insurance requires a 30 day waiting period. If there’s a hurricane heading toward you and you decide it might be a good time to check your policy, it might be too late.

Many people don’t buy flood insurance because they don’t want to pay the added cost. Afterall, when looking into purchasing an insurance policy on a sunny, beautiful day, flood insurance might not be the top priority. But, remember the purpose of insurance—to protect you from the unexpected. In this instance, the risks far outweigh the cost in many situations. The cost over time of payments for flood insurance will be significantly less than if you don’t have it and are a victim of flood damage.

We will be happy to review your homeowner’s policy and discuss flood insurance options to help protect your home and property. Give Bosworth & Associates a call today and let’s review if flood insurance is something you should consider in adding to your insurance portfolio of protection.

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