The rainy season for most parts of the country begins in November and ends in April, and with it comes the risk of heavy flooding. Many people are unaware or apathetic to the risk of a flood in their area, a fact that causes hundreds of thousands of dollars worth of flood damage to home and business owners each year. But with so many insurance companies trying to sell you flood coverage, how do you know what kind of a policy you should invest in, how much you should expect to pay, and the benefits you should expect for your money? It can seem overwhelming, but the first step in feeling confident in your insurance coverage is understanding a little bit about what flood coverage is, what kinds of policies exist, and, most importantly, what coverage fits for your particular flood risk.
Before you invest in flood insurance you should know what exactly what it is. There are a few basic types of flood insurance. The first kind is classified as "dwelling" insurance and usually covers residential buildings that contain no more than four families, residential condominium units, manufactured homes, and the storage contents of the insured building's tenants.
Another kind of flood insurance is "general property," policies that tend to cover larger residential buildings (ones that house more than four family units) as well as certain commercial buildings, such as churches, schools, and small businesses.
Certain companies also offer "preferred risk" policies. These policies are generally offered at a lower cost to residential and commercial building owners with a low to moderate flood risk levels.
Because floods are not extremely common natural disasters, many people don't feel the need to protect themselves with flood insurance. However, even a few inches of standing or moving water can cost thousands of dollars to home or business owners. Flood insurance not only helps cover the financial burden of flood damage (up to $350,000 on average for residential customers' homes and their contents) but many providers can help you find other disaster relief services, such as document restoration specialists.
How is flood insurance different than other kinds of insurance?
There are a number of very important questions you should ask your insurance agent before deciding on the flood insurance policy that is right for you. The first thing your agent will want to know is whether or not your home or business is located in a high-risk area. Your agent may even ask for an "elevation certificate", a risk rating that helps builders ensure compliance with local floodplain ordinances and helps agents determine what types of policies are needed. Here are a few basic questions you should have in mind when discussing policies with your insurance provider:
These are just a few starter questions. Make sure to ask any question that comes to mind. You want to fully understand your policy before you commit to anything.
If you eventually need to file a claim due to flood damage, contact your insurance agent or company as soon as you can. The insurance provider will then assign a claims adjuster to evaluate your loss and help you file a claim. Make sure you have the name of your insurance company and your policy number in an easily-accessible place. This will help speed up the filing process.
If the flood damage is bad enough you may end up staying in a shelter, hotel, or with friends. Make sure your insurance agent has a reliable contact number for you in case of emergencies. If your insurance company has not contacted you within a day or two of the initial claim filing it may very well be that they do not know how to get in touch with you.
After you've contacted your agent you will need to start making a list of all damaged or lost valuables. Separate your damaged goods from the undamaged ones and, with the help of your adjuster, start itemizing and calculating the value of the destroyed property. Finally, you will need to make your official claim for damages, called the "Proof of Loss", within sixty days of the flood.
Flood damage can prove devastating if you don't have the proper insurance. Luckily, getting the right flood insurance doesn't need to be an overwhelming experience. With a little research and planning, you can find an affordable plan that will cover your valuables should the unthinkable occur.
~Ben Anton, 2008