Ninety percent of all natural disasters in the United States involve flooding, and 20% of all flood claims are filed in low to moderate risk areas.
So how can you protect yourself against the risk of flood? Read on for some more information.
Flood is not covered by renters or homeowners insurance policies
Flood is listed as an exclusion on a standard renters insurance policy. An exclusion is a policy provision that eliminates some type of risk — in this case, flood. However, incidental damages from flooding often are covered. You can learn more by reading our article Does Renters Insurance Cover Flood?
Flooding and federal disaster aid
Less than half of all flooding occurrences qualify for federal disaster aid. This is only possible when the President makes an official declaration of disaster. Often the only aid comes as an interest-bearing loan, commonly in an amount less than $2,500. A flood insurance policy is the best way to protect yourself from the risk of flood.
A flood insurance policy is the only way to cover home flood-related losses.
Flood Zones
How do you know if you live in a flood zone? You can check on the Federal Emergency Management Agency’s website here. If you are considering making a move, or buying a house, it’s a good idea to check this information before getting locked into a lease or mortgage.
Flood zones are often based off of proximity to bodies of water:
V Zones: These are considered the highest risk flood zones, as they are usually located near an ocean. The average premium for a V-zoned policy is around $1000 annually.
A Zones: These zones are often located near a lake, stream or river, and are the second highest risk zone. The average premium for an A-zoned policy is $557 annually.
B, C, X, and A99 Zones: These are considered “low risk” zones, and are less prone to flooding. If you live in one of these areas, you may qualify for a Preferred Risk Policy and could pay a premium of only $119 annually.