Facts You Need to Know About Flood and Hurricane Insurance
One of the most common misconceptions with insurance against flooding is that homeowner’s insurance covers floods. Only flood insurance, issued through the National Flood Insurance Program, offers that protection. In 2014, about 5.3 million homeowners in the country had flood insurance. Only people living in special flood hazard areas or high-risk flood areas, and have a mortgage backed by the federal government, are required to have flood insurance. However, 1 out of every 4 flood insurance claims comes from homeowners outside high-risk flood areas. From 2010 to 2014, floods or flashing flooding have been reported in every state in the country. Understanding flood insurance and hurricane insurance issues can ensure you are properly protected in the event of a storm.
Hurricane deductible. Insurance companies in many coastal states, including Louisiana, South Carolina and Florida, have added hurricane deductibles to homeowner’s policies. The precise language varies from state to state and the deductible may specifically be for hurricanes or for wind storms in general. It’s important to know if this is a part of your coverage because the deductible can be up to 5 percent of the value of your home. It is possible to purchase additional insurance to make up for that hurricane deductible. Most experts recommend going over your homeowner’s policy every year or two with an agent to make sure you remain properly insured.
Don’t wait to buy flood insurance. If you see that a storm has formed and may be headed in your direction in the next week, it’s too late to purchase flood insurance. All flood policies come with a 30-day waiting period for just that reason. For most Americans, the average cost of a flood insurance policy is between $500 and $600 a year while the average payout on a flood claim is more than $4,000.
Review policy limits. Flood insurance is limited to a maximum of $250,000 for structures and $100,000 for contents. However, it is possible to get a second policy to supplement your flood coverage if your home and valuables are worth significantly more. While flood insurance comes from the federal government you can purchase a policy through your current insurance agent.
Mold coverage. If a hurricane sends flood waters into your home, a significant danger is that mold will develop and spread through the home. While most mold is not toxic, it can trigger asthma and allergy attacks. Mold, a fungi, can spread rapidly in warm, moist conditions. If wet flooring and soaked drywall and insulation is not removed fairly quickly from the home, mold can spread rapidly. The problem is that not all homeowner insurance policies pay for mold remediation. Adding the coverage is not costly, but it’s a matter of taking the time to review your policy with your agent.