Do I need flood insurance?
“…from 1958 to 2016 heavy rainfall events have increased in the northeastern states by 55%, midwestern states by 42%, and southeastern states by 27%.”
Record rainfalls, hurricanes, and flooding have been in the news recently and the predictions for the future warrant concern. NASA’s research reveals, “from 1958 to 2016 heavy rainfall events have increased in the northeastern states by 55%, midwestern states by 42%, and southeastern states by 27%.” Climate change is causing rising sea levels and heavier rainstorms that are expected to cause more flooding on and off the coast in New Hampshire, Connecticut, and the rest of the country in the coming decades.
Your home is probably the biggest investment you’ll make in your lifetime but your home means so much more than just an investment, so you work hard to protect it. With all that in mind, you may be wondering if your home insurance covers water or flood damage.
What type of water damage is covered by homeowners insurance?
Many policies help cover water damage if the cause is sudden and accidental, like damage resulting from burst pipes or if a washing machine supply hose suddenly breaks. However, there are limitations. For instance, homeowners insurance won’t cover the cost of repairing or replacing your washing machine and doesn’t cover damage resulting from poor maintenance. Also, homeowners, renters, and business property insurance policies don’t cover damage caused by flooding.
When you purchased your home, you weren’t required to have flood insurance so your house must be safe from flooding, right? Not necessarily. You’re required to have flood insurance if you have a federally backed mortgage and you live in a flood hazard zone, as mapped by the Federal Emergency Management Agency (FEMA). So, if you don’t have a federally backed mortgage you weren’t required to purchase flood insurance even if you live in a flood zone. Also, the flood maps may have changed since you purchased your home and you weren’t notified, and it gets even more complicated than that.
Is my house in a flood zone?
Many people think that because they don’t live near an ocean or large body of water, they aren’t in a flood zone. In reality, every property in America falls into a potential flood area. Some areas are more susceptible to flooding than others.
“5.9 million properties and property owners are currently unaware of or underestimating the risk they face because they are not identified as being within the SFHA zone.”
POTENTIAL SOURCES OF FLOODING
- Snowmelt/spring thaw
- Ice flows
- Dam breaches
- Broken levees
- Tropical storms
- Remnants of tropical storms in the northeast
- Farmland flooding
- Flooding after a forest fire
- Limited drainage systems
- Riverine flooding
- Water main breaks
- Neighborhood construction
Many people use the FEMA Flood Insurance Rate Maps to understand their flood risk, but it doesn’t tell the whole story. According to an analysis by the First Steet Foundation, New Hampshire faces 2.2 times and Connecticut 1.8 times the number of properties identified by FEMA as having substantial flood risk. The Foundation “uses the current climate data, maps precipitation as a stand-alone risk, and includes areas that FEMA has not mapped.” Their report states, “At the national level, the First Street Foundation Flood Model identifies around 1.7 times the number of properties as having substantial risk compared to the FEMA 1-in-100 SFHA designation…5.9 million properties and property owners are currently unaware of or underestimating the risk they face because they are not identified as being within the SFHA zone.”
In addition, a report by the Association of State Floodplain Managers states that the flood maps that FEMA produced cover only about one-third of the nation’s 3.5 million miles of streams and 46% of shoreline. That’s a huge gap. Does your home fall into that gap?
You can view the full First National Flood Risk Assessment and First Street’s database for detailed flood risk by state and by address. Another resource is the NOAA storm history database which can help you assess if your neighborhood has flooded in recent years. This is especially helpful for new home buyers.
Even if your home isn’t in a flood zone, you may still need flood insurance.
EVERY PROPERTY IS VULNERABLE TO FLOODING
Floods are one of the most frequent natural disasters and can impact anyone, anywhere, at any time. Floods are the number one natural disaster in the United States. The National Geographic online encyclopedia claims, “There are few places on Earth where people don’t need to be concerned about flooding.” Floods can happen anywhere, not just in high-risk flood zones.
“There are few places on Earth where people don’t need to be concerned about flooding.”
FLOOD FACTS TO CONSIDER:
- All 50 states have experienced flooding, including flash flooding, in the past five years.
- Floods are the most common and costly natural disaster in the United States.
- Scientists have found that the amount of rain produced by heavy rainstorms has gone up 10% since 1900.
- Extreme rainfall events are trending upward, nine of the top ten years for extreme one-day precipitation events have happened since 1900.
- Most homeowners, renters, and business property insurance policies don’t cover damage caused by flooding.
- More than 40% of National Flood Insurance Program (NFIP) claims in the last five years come from outside the high-risk flood areas.
- Floods can happen anywhere, not just in the high-risk flood zones. Historically, properties in low-risk flood areas account for more than 20% of the recorded flood losses.
- Flood risk can change suddenly.
There are two types of flood insurance, the NFIP, which is written by FEMA provided you live in a participating community, and private flood insurance, both are available through insurance agencies and directly through the insurance carriers. Federal flood insurance has a 30-day waiting period.
In the event of a flood, federal disaster assistance may be limited or unavailable. This assistance is only available if the President declares a disaster. If you have flood insurance your home is covered even if a disaster is not declared.
Homeowners in low-to-moderate risk areas may be eligible for a Preferred Risk Flood Policy (PRP) which provides flood insurance protection at a lower cost. You might lower your costs even more by bundling your insurance plans and/or through flood mitigation options.