Flood Insurance – Basic information on flood insurance
Flood insurance is a specific kind of insurance policy that protects your property against damage caused by flood, something that, contrary to the beliefs of thirty-three percent of Americans, can be excluded on general home insurance policies.
If you live in an area which is at a high risk of flooding, insurance against flood damage is something you should definitely consider. Insurance companies which offer policies which protect against flood damage will usually use topographical maps to understand the exact risk of flood damage that your home is under. Many insurance companies in the US do not offer flood insurance to everyone at risk, and to fix this, the National Flood Insurance Program or NFIP was created.
The objective of the National Flood Insurance Program, which is managed by the FEMA, or Federal Insurance & Mitigation Administration, is to allow everyone at risk of flooding to insure their property against flood damage. Participation in the National Flood Insurance Program is based on agreement between the federal government and local communities, and states that if a community prepares for the possibility of flooding, and adopt a flood plan management ordinance to reduce flood risks to new constructions in Special Flood Hazard Areas or SFHA’s, the federal government will ensure that flood insurance is available to members of that community.
In the UK, particularly in light of recent events, flood insurance has a number of benefits, although, again due to previous events, flood insurance premiums are higher than average at the moment. If you are already a flood insurance policy holder, then your flood insurance policy will compensate you for the loss or damage of all covered items. In the US, you will still be compensated, even if the President does not declare a federal disaster. Flood payments will be dealt with swiftly, and you can even request an emergency payment immediately after a flood to help you recover from the damage even more quickly.
A flood is defined by the National Flood Insurance Program of America as “a general or temporary condition of partial or complete of two or more acres of normally cry land area or of two or more properties, at least one of which is the policy holder’s property”, and can be caused by a number of things. Mudflow, overflowing inland or tidal waters, unusual accumulation of surface waters from any source or the collapse of land along the shore of a lake can result in a flood. Although floods are far more common on land which is nearer to the ocean or large bodies of water, flash floods are also possible, and occur when an unusual amount of rain falls within a short time.
The effect of urbanization and, with more and more concrete roads and parking lots replacing natural land means that the lands natural ability to absorb water is decreased. This, combined with changing weather patterns, has made floods more likely, and more severe, as the recent flooding in England and New Orleans has shown. Floods don’t necessarily need to be dramatic or contain a lot of water to damage your belongings; a single inch of water can cause costly damage to your home, and only a few feet of water is enough to carry your car away.
When choosing flood insurance, as with any other kind of insurance, it’s important to look around for the best quotes. Homeowners insurance rates can change in light of recent events, and checking out different quotes, perhaps online, in order to find the best flood insurance plan for you is always a good idea. Flood insurance costs can also vary between companies.