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Flood Insurance: Are You Covered? 7 Key Points to Consider

Feb 28, 2024 | United Agencies Corporate Blog

According to the California Department of Insurance, Flooding is the nation’s number one natural disaster. While floods occur in every area of the country, many property owners remain unprepared and even uninformed as to what coverage they need.

Here are 7 important key points to consider:

First and foremost, standard homeowners insurance does not cover flood damage. Therefore, it is important to know what options are available to protect your assets from flood losses.This is why it’s such an important consideration due to our state’s diverse geography and potential for various flood risks.

1. National Flood Insurance Program (NFIP): The NFIP is the primary source of flood insurance coverage in the United States, including California. It is managed by the Federal Emergency Management Agency (FEMA) and aims to reduce the impact of flooding on private and public structures. NFIP policies are available for homeowners, renters, and business owners.

2. Risk Assessment: FEMA assesses flood risk using Flood Insurance Rate Maps (FIRMs), which outline areas prone to flooding based on factors like historical data, rainfall, tidal surges, and topography. Properties located in high-risk flood zones (Special Flood Hazard Areas or SFHAs) are typically required by lenders to carry flood insurance.

3. Coverage: Flood insurance policies typically cover structural damage and belongings up to certain limits. However, coverage for personal belongings is separate from coverage for the structure itself and may need to be purchased separately. It’s essential to review policy details carefully to understand what is and isn’t covered.

4. Cost: The cost of flood insurance in California varies depending on factors such as the property’s location, elevation, flood risk, and the coverage amount selected. Properties located in high-risk flood zones generally have higher premiums compared to those in lower-risk areas.

5. Private Flood Insurance: In addition to NFIP policies, some private insurers offer flood insurance coverage in California. Private policies may offer additional coverage options or competitive pricing compared to NFIP policies. It’s essential to compare quotes and coverage options from both NFIP and private insurers to find the best policy for your needs.

6. Mandatory Purchase Requirements: If you have a federally backed mortgage and your property is located in a high-risk flood zone, your lender will likely require you to purchase flood insurance. Even if you’re not in a high-risk area, it’s still a good idea to consider flood insurance, as floods can occur in any location.

7. Community Floodplain Management: Local governments in California also play a role in floodplain management by implementing regulations and floodplain management strategies to reduce the risk of flooding. These measures may include zoning ordinances, building codes, and floodplain development regulations.

Today, it’s crucial for homeowners and renters to assess their flood risk and consider purchasing flood insurance to protect their property and belongings. Be sure to  Contact Your United Agent for any questions or assistance you might need. We are happy to help!