According to the National Weather Service, in the year 2019, 93 people have died in the United States due to flooding. Storms and hurricanes have become very common, in the southeastern portion of the US, making flood insurance imperative for your home. Especially those in Texas, Lousiana, Missouri, Oklahoma, and Missippi, as they have had the highest concentration of flood related deaths this year. If that isn’t enough to compel you to purchase flood insurance, here are 5 more reasons:
1) Flood insurance is required to take out a loan for a home in a flood-prone area
The government hasn’t yet made it mandatory to have flood insurance coverage–in any of the states. But, you do need it before borrowing money to buy a house in a flood-prone area. Particularly, if the lender is an FDIC-backed bank. A lender will have to incur a heavy penalty if they choose not to abide by this rule.
2) Standard home insurance does not cover losses from flooding
This is another compelling reason to purchase flood insurance. Standard home insurance covers your dwelling, personal property, and injury or damages to your or someone else’s property, but it does not provide earthquake or flood insurance coverage. To secure yourself from damages caused to your home due to flooding, you would be encouraged to buy additional coverage.
3) Not having a flood insurance policy is a gamble
Whether you live in a flood-prone zone or not, your home can always suffer damages due to rains. What if it rained for a few days in a row flooding the entire city? There have been plenty of instances where cities were submerged underwater for days. (See Houston, Texas) Such rain could easily damage your home and/or the contents inside it. Why take such a huge risk?
4) It won’t cost you a fortune
According to a report by Kiplinger, the average cost of a policy is about $700 a year. For just $59 a month, your insurance company will cover you for all the damages incurred by your home during a flood. By not purchasing flood insurance, you may have a lot to lose.
5) 20-25% of all economic losses occur in areas not designated as flood-prone
This stat was mentioned in a training manual published by the US weather department. The weather department blames urban drainage for the floods caused in non-flood-prone areas. They also concluded that the flooding that occurred due to flaws in urban drainage systems happened more quickly and usually to greater depths. So, not residing in a flood-prone zone is not necessarily an excuse for not having a flood insurance policy.
I hope the above post helped you understand the importance of upgrading your home insurance with flood insurance coverage. Whether you live in a flood-prone zone or not, don’t risk losing your investment due to a natural or unnatural calamity.