Is Flood Insurance Really Necessary?
Most homeowners insurance policies do not cover flood damage. Although people may not reside in a location prone to flooding, it might be a good idea to get this coverage anyway.
Other People Are Reading
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Misconceptions
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According to flood insurance provider Bearingstar, 25 to 30 percent of all flood-related damage occurs in areas not considered at risk of flooding.
Important Fact
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According to Nolo.com, flooding happens more than any other natural disaster. In 2004, half of the victims of Hurricanes Katrina and Rita had no flood insurance, mostly because they were in areas not considered flood risks.
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Features
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Flood insurance covers more than just massive flooding from inclement weather. Flooding can occur from snow melting, ponds and creeks rising, and poor levee design.
Typical Costs
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For areas not in flood hazard zones, insurers such as the National Flood Insurance Program charge about $233 (with a $500 deductible) each year, which covers $100,000 worth of house damage and $40,000 for personal items. People in risky areas, such as below a hill, can expect costs of $860 to $1,900 each year.
Tips
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Flood insurance should not replace homeowners insurance, especially in flood-prone areas. Also policies should replace actual parts and materials, not just a specific dollar amount--raw materials and manpower cost more after a flood.
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References
- Photo Credit Image by Flickr.com, courtesy of Thejas
