Not all water losses are considered flood damage. For your losses to be covered under a flood insurance policy, the following example of a flood definition could apply:
A general and temporary condition of partial or complete inundation of two or more acres of normally dry land area or of two or more properties (at least one of which is your property) from: overflow of inland or tidal waters; and unusual and rapid accumulation.
The Dangerous Truth About Flooding
According to the Federal Emergency Management Agency (FEMA), flooding is the nation’s most common natural disaster. Twenty percent of flood claims are filed by people living in moderate- or low-risk areas. Floodwaters have the power to damage not only your home and sense of security, but also your financial future. How can you protect your most important investment? What are your flood options?
How to protect
Floods can happen without warning, jeopardizing your home and valuables. While it’s impossible to prevent floods, there are a number of steps you should take when a flood watch or warning is issued:
- Check your sump pump. Test the pump by pouring water into the pit. Make sure the discharge hose sends the water several feet away from the house and slopes away from the property.
- Move valuables to higher locations. If you have time, move important items like photo albums, insurance policies, money and jewelry to the highest floor in your house.
- Shut off electricity in areas that might flood. This will reduce the potential for electrical shock.
Above all, it’s important for you to have an emergency plan. This plan should include evacuation procedures, methods for securing valuables, written instructions for turning off utilities and contact information for your insurance broker.
Option #1: FEMA
Many people wrongly believe that the U.S. government will take care of all of their financial needs if they suffer damage due to flooding. The truth is that federal disaster assistance is only available if the president formally declares a disaster. Even if you do get disaster assistance, it’s often a loan you have to repay with interest, in addition to any mortgage loans that you still owe on the damaged property.
Most importantly, you must consider the fact that if your home is flooded and disaster assistance isn’t offered, you’ll have to shoulder the massive damage costs alone.
The bottom line? If you’re looking for secure protection from financial loss due to flood damage, federal disaster assistance is not the answer.
Option #2: Buy Flood Insurance
When disaster strikes, flood insurance policyholder claims are paid even if a disaster is not federally declared. Flood insurance means you’ll be reimbursed for all of your covered losses. Plus, unlike federal aid, it never has to be repaid.
As long as your community participates in the National Flood Insurance Program (NFIP), you’re eligible to purchase flood insurance.