Did you know just two inches of standing water can cause tens of thousands of dollars of damage to your home? Did you also know that standard homeowners insurance generally does not cover damages caused by groundwater? Fortunately, flood insurance offers a solution, and we here at Giuffre Insurance can help you find it.
National Flood Insurance Program (NFIP)
Since floods are the most expensive loss events in the U.S. each year, insurers will not typically cover damages as a part of a standard homeowners or renters insurance policy. Instead, the National Flood Insurance Program exists to provide coverage against the devastating effects of floods to all homeowners and renters – including those who live in high-risk areas. It is overseen by the Federal Emergency Management Agency (the same FEMA that responds to and provides aid in federal disaster areas).
NFIP coverage is separate from your homeowners or renters coverage and can be purchased from your independent agent here at Giuffre Insurance. In some cases, it is required to satisfy the requirements of a mortgage lender. However, we typically recommend that all homeowners consider adding this important protection to their insurance portfolios, including those who do not live in known flood plains. That is because one in every four flooded homes exist in ‘low risk’ areas. If yours is one of them, how will you cover the cost of cleanup, remediation, and repair?
Types of NFIP Coverage
Your NFIP coverage may include different types of coverage depending on your needs. For example, renters may only need coverage for personal property (home contents), which is usually capped at $100,000. Homeowners need not only personal property protection but also replacement value coverage for the structure of the home, which is usually capped at a maximum of $250,000. Homes with values that exceed the maximum available NFIP coverage limits may qualify for supplemental flood protection from a private insurer.
Should You Purchase Flood Insurance?
There are many costs associated with flood damage. First is the cleanup. Often, all of the furnishings, textiles, appliances, wood floors, and cabinetry are a total loss and must be removed from the property. The walls and baseboards may also be destroyed, and there may be a need for mold remediation. Then, the interior of the home must be rebuilt with proper materials and man-hours, and the damaged belongings will need to be replaced. Unless you can afford a sudden and unexpected loss of this caliber, we typically recommend purchasing flood protection as a preventative measure. If you live in a low-risk area, you may qualify for lower premiums than someone who lives in a higher-risk area; but either way, having the right coverage in place could spare you from thousands of dollars in losses in the event of a groundwater swell.
If you own a home in a high-risk area that obligates you to purchase flood insurance, then the coverage is mandatory. It is also possible that you could receive notification that your home has been re-zoned into a newly designated high-risk flood zone, which now requires that you purchase flood protection. In these cases, the usual 30-day waiting period before flood insurance becomes effective may be waived. FEMA provides insight into the flood zones in your area by inputting your address into the flood map search tool on its website.
Disaster Assistance vs. Flood Insurance
It is important to understand the difference between flood insurance and disaster assistance, as the two are very different. While FEMA may provide some grants and aid after a flood, it is usually only available in small amounts intended for temporary living and medical expenses. Furthermore, FEMA only distributes aid in federal disaster zones. If your home floods in an area that is not designated a disaster area, your resources may be limited to your personal savings or a loan. That could mean making years of payments on the balance of the loan plus interest until you cover the full cost of repairing your home out of your own pocket.
Applying for Wisconsin Flood Insurance
If you are considering flood insurance for your home or recently received a notice of a re-classification of the flood zones in your area, now is the time to purchase the coverage you need. Some areas flood frequently, areas that flood every few years, and areas that never flood – except every hundred years or more. Don’t wait until it is too late to apply.
In most cases, the NFIP imposes a 30-day waiting period on flood insurance applications. This is to prevent the issuance of new policies when early forecasting models suggest a flood threat due to impending storms. (Exceptions to the 30-day rule generally apply to newly zoned floodplains and people who are taking out a new mortgage that requires flood protection. Talk to your agent if you have questions about how long it might take to insure your home or belongings.)
Why Use an Independent Agent?
NFIP flood insurance is not sold directly to homeowners and renters. Instead, it must be purchased through a licensed Wisconsin insurance agent. By choosing an independent agency like Giuffre Insurance, you are getting the experience and support of an independent agent who can give you the personalized advice and assistance you have come to expect from a local, hometown agency.
We not only help you find flood insurance for your property, but we can also help you find supplemental flood protection where available. We can also review your other water damage coverage for things like burst pipes, water backup, and more. If we find water damage deficiencies in your homeowners or renters policies, we can offer solutions to help fill coverage gaps and give you the protection you need.