Flood Insurance

Will you recover from a storm that leaves you underwater?

If the water rises, will it dry out your savings account?

The average American home is more likely to be damaged by floods rather than fire, a warning from the U.S. Federal Emergency Management Agency (FEMA) highlights the reality. FEMA states nearly 90% of natural disasters that occur in the US involve flooding. An area’s natural drainage could be impacted by nearby development or heavy rainfall leading to flash floods, leaving any homeowner vulnerable. Unfortunately, standard homeowner insurance policies do not cover flood damage and less than 1% of Michigan residents carry separate flood insurance! If you are one of the 99%ers, you could be facing an uncovered loss that could be $50,000 or more for cleanup and reconstruction costs. 

In addition, once again per FEMA, If you live in an area with low or moderate flood risk, you are 5 times more likely to experience flood than a fire in your home over the next 30 years.

Coverage that meets your needs

Navigating the market for flood insurance can be difficult. The market is complex, with numerous caveats that are critical when selecting coverage. For example, did you know that flood coverage has a 30-day waiting period before the policy goes into effect … a challenge for those who have not yet assessed and addressed their exposure.

In addition to the policy mechanics, there are a number of specific coverages that need to be reviewed when assessing your Flood/ Water Damage exposure.  Items such as:

  • Water damage coverage vs. Flood coverage … there is a difference.
  • Excess flood coverage vs what is available from the National Flood Insurance Program (NFIP).
  • Coverage limits for backup of sewers and drains.
  • Reimbursement for risk mitigation efforts such as sandbags, labor, and personal property removal.
  • Protection for finished basements.
  • Higher coverage limits for valuables and collections.
  • Coverage for additional living expenses incurred when you must vacate your home for repairs.
  • Protection for potential additional costs to comply with new laws or ordinances required post loss.

So, what’s your plan?

If you have not recently assessed your Water/ Flood exposure, it is imperative that you work with an insurance professional, such as Guy Hurley, who can assist you in designing an effective Risk Management preparation plan.  Someone, like us, who knows the market and can assess your specific needs and can help you to make the right policy choices based on location, limits, and other factors.

Claim Example:

A homeowner’s basement flooded after a particularly heavy summer thunderstorm, causing enough damage to warrant filing a claim with their homeowners’ carrier. Much to the homeowners’ chagrin, the Homeowners’ carrier denied coverage for the damages, pointing to the fact that the water loss was due to flooding, which, as we now know, is not covered under a standard homeowner’s policy.

Thankfully, for this client, they were with an formidable agent who had also secured for them separate flood insurance, saving them thousands in clean-up and repair costs.