Five Reasons Why You Should Carry Flood Insurance - National Flood Insurance

There are very few places on earth where people need not be concerned about flooding. In the United States, flooding causes about $8 billion dollars in damages and kills about 140 people every year. Because flood insurance is not always required by mortgage lenders, there is a sense of security regarding flood risk that is both false and dangerous. Here are the real facts on why you should consider flood insurance:

  1. Flooding is not generally covered by Homeowners Insurance. Rising water, whether caused by excess rain, storm surge, snowmelt, river rise, or any other source, is considered a flood, and you need specific flood coverage to be protected from it.

  2. Flood insurance in non-mandatory zones is very affordable. For most people, their home is their largest asset, and to protect it from flooding for $1-$2 per day just makes good sense.

  3. Your property probably carries a much greater flood risk than you think. FEMA’s flood mapping is decades out of date, meaning it does not take into account any land changes since the last mapping. Even up-to-date flood mapping cannot predict future conditions, and it’s impossible to draw a line on a map and determine where water will stop.

  4. Flooding is catastrophic. Even one inch of water will damage electrical and HVAC systems, along with walls, doors, carpeting, appliances, and cabinetry. The average cost for these repairs is $27,000, and without flood insurance, you’re on your own.  

  5. FEMA will not bail you out. At least, not in the way you might think. Only if a flood event has been declared a federal disaster is FEMA assistance available, and even then, it is a loan that must be repaid with interest. You must obtain flood insurance before receiving any FEMA flood assistance, and you’ll be required to maintain the coverage for as long as you own the home.    

Floods are increasing in frequency and severity, and over 25% of all flooding in the U.S. occurs in “low-risk” areas. If your home is completely destroyed by a flood, you are still responsible for the balance of your mortgage. Many homeowners were forced into bankruptcy after major flooding events such as Hurricanes Harvey and Florence. For less than the cost of a cup of coffee per day, is it really worth the risk?