This year, weather has transitioned from being a small-talk topic to the center of attention. With hurricanes Harvey and Irma causing massive storms in Texas and Florida, respectively, deadly and damaging weather is on everyone’s mind. Different parts of the U.S. have also experienced the dangerous effects of flash flooding from sudden rainfall. Even the Great Lakes are at their highest water levels in years—Lake Ontario has already flooded parts of New York.
At this point, many people are wondering about flooding and homeowners insurance. What’s covered? What isn’t? Part of protecting your home and belongings is having a thorough understanding of your policy and obtaining the right mixture of coverage.
CoverHound has the scoop on flooding and insurance, and a quick way to compare homeowners insurance quotes to find a fitting policy. Keep reading to learn more!
What to Expect from a Standard Policy
To be clear: standard homeowners insurance policies do not cover flood damage. Homeowners who want or need this extra protection must take out a policy from the National Flood Insurance Program, or a specialty private insurer who does offer flood protection. It’s important to note that NFIP policies typically cover replacement costs for a home’s structure (how much it would take to rebuild the structure as it was before up to $250,000), but actual cash value for possessions inside (up to $100,000, factoring in depreciation).
As the Wall Street Journal points out, U.S. law even requires those with a federally backed mortgage who live in a designated flood area to buy basic flood coverage. However, homeowners outside of the highest risk areas may choose to buy this separate coverage in case their home experiences flooding from a nearby lake or river. NPR reports that FEMA estimates show that only 42 percent of homeowners along the Florida coastline have coverage, while only 20 percent of coastal Texas residents do.
Waiting until a storm, flood or hurricane warning is in effect means it’s too late, as NFIP policies have a waiting period of 30 days before they take effect.
How Water Damage Differs
It’s just important to note the distinction between flooding from a natural disaster versus an internal water damage issue like a burst pipe. Non-weather-related water damage (like malfunctions with plumbing systems or appliances) accounts for 19 percent of all homeowners insurance claims, making it the second most common cause for filing a claim.
Understanding what your policy does and does not cover before an accident or disaster can make a huge difference in the outcome. Whether you ultimately decide to enroll in NFIP flood insurance or shop with private insurers, it’s important to stay informed and protect your finances to the best of your ability. And for wind damage, fires and theft, most standard policies will have your back.
Is it time to revisit your insurance policy? Compare homeowners insurance quotes with CoverHound today! We wish you a safe rest of the year.