Our previous entry on hazard insurance, Are You on Shaky Ground?, looked at the need to buy a supplemental earthquake policy if you want coverage when the ground starts to shake. Here’s another major hazard that isn’t covered by standard insurance policies: flooding. Obviously floods pose more risk for folks living in the Northwest than in California, but even in arid regions the risk of flash floods can be significant.
Not-so-fun flood facts:
Floods and flash floods happen in all 50 states
Everyone lives in a flood zone (says FEMA)
Just an inch of water can cause costly damage to your property
Flash floods often bring walls of water 10 to 20 feet high
A car can easily be carried away by just two feet of floodwater
In high-risk areas, flood damage to a home is more than twice as likely as fire damage
Fortunately for us, the federal government has stepped in to offer flood insurance. The National Flood Insurance Program, administered by the Federal Emergency Management Agency (FEMA), issues federally subsidized flood insurance. You buy this insurance directly from authorized insurance agents, not the government. In fact, if you live in an area at high risk for flooding and have a federally backed mortgage, your mortgage lender will require you to obtain flood insurance.
Anyone can determine a property's degree of flood risk, the cost of coverage, and the names of local insurance agents who offer flood policies by checking this Flood Smart website. And flood insurance or not, it's wise to look at this list of FEMA steps to reduce flood damage to your property.
Remember, Rockwell Institute is always happy to answer your questions about real estate education.