I called my insurance agent, Corey Benson, to get you some timely information about flood insurance. I hope this helps those of you that have or want flood insurance. For more information please go to http://www.co.marion.or.us/hlt/flooding.html
Article by Corey Benson, Farmers Insurance Agent, Photo by Curt Wagner
If you were like most insurance policy holders in the Pacific Northwest, you were calling your insurance agent to see if you currently had any flood coverage under your policy. A few of you were lucky enough to avoid damage or have an actual flood insurance policy in force. Some people were dealing with devastating issues that they had never dealt with before, even since our flooding issue back in 1996. Water has a way of working itself through the path of least resistance and that path changes year after year.
Most people don’t really know how this insurance stuff works, and I apologize in advance for doing what I do best, and get really nerdy with how these policies work. To break this down in the simplest way, flood insurance is a separate policy outside of your basic dwelling (homeowners and renters) policy. There is no endorsement available to add coverage to your existing policy to cover flood damage. Another thing to look for is what the definition of a loss is within your insurance policy. What that means is, if your house is flooded because your washer broke due to a manufactured issue, more than likely your basic dwelling policy will cover that within its own declarations. However, if your house is flooded from an immediate rise of water because of excessive rain flow and or snow melt, your normal insurance program or policy will need some assistance from an additional policy (A Flood insurance policy).
A common misconception from consumers (and some insurance agents) is that you can’t get a flood insurance policy if you are not in a high risk flood zone. The truth is that anyone that is listed in a flood zone determined by Federal Emergency Management Agency (FEMA) can get a flood insurance policy. The secret is that if you live anywhere near any sort of body or water or in a region or town associated with a water supply, you probably have a flood zone determined for your property. Another major misconception is if you don’t own any property, your Renters Insurance policy would be all that you would need. Again, Renters insurance doesn’t cover anything regarding a flood, you would need a separate flood insurance policy to just cover Contents (your personal property). If you are a landlord, or if your landlord, has a flood insurance policy on the property of which you rent, only the named individuals on the policy is covered. As a renter, you should have a renters policy set up and also check with your landlord and insurance agent about options to see if it makes sense to cover your stuff with a separate flood insurance policy. Your landlord or insurance agent will usually not ask you, as the renter, if you feel you need a flood insurance policy. Overall, as a consumer, know what you’re buying and see if it’s worth the risk.
I feel that I have done enough damage in geeking out but I am sure that I am leaving you with two simple questions; how do I know which flood zone that I am in and how much will this cost me? One simple way is to call and ask for a quote from your current insurance carrier. We as agents, have the ability to pull up a zone determination from FEMA. It can take up to 24 hours to get that back and sometimes within the same day. In some cases there is a preferred risk program which saves a lot of time and money when it comes to getting a policy set up but the only way to find out if you are eligible is by simply asking. In other cases there might be some eligibility for some grandfathering options depending on when your home was built and when and if your flood zone has been updated. The coolest part about taking this step to learn about the property of where you live is that this is all free, up until you actually buy the policy. You have nothing to lose in checking it out. Take control of this risk and be prepared. If not a complete policy covering the home and contents, look into the option of covering just your contents, if anything, to see how much that might cost you a year.
Just in case you thought that I was done being a nerd in regards to this flood policy stuff, here are a few tidbits that all flood insurance prospects and policy holders alike should know about. Government statistics show that a little more than 1,060 flood insurance policies are active in Salem city limits (I am willing to bet that is because no one buys it unless a home loan requires you to buy it). In the entire state of Oregon, a total of about 34,740 flood insurance policies are in force. Damage directly caused by floods is usually covered by flood insurance, but there are exceptions:
- Moisture and mold damage that could have been avoided by property owners isn’t covered.
- Flood insurance doesn’t reimburse for damaged items outside of buildings, such as fences, patios, and hot tubs.
- No payments are made for temporary housing or living expenses.
- Cash or precious metals lost in floodwaters aren’t covered.
- Flood insurance also has two separate deductibles that would separately apply to your dwelling coverage and your contents coverage and your coverage will only kick in for actual cash value. Your lowest deductible option is $1000.
- There is a standard 30 day waiting period for your flood insurance policy from when you purchase the policy, unless it’s a lender required policy from a newly purchased home.
- A flood insurance policy is the only policy that will pay out in the event of a flood defined by FEMA.
For loads more information and some know how, visit www.floodsmart.gov as it’s the National Flood Insurance Program’s (NFIP) official website and a very valuable resource (They have a very cool hypothetical tool to see how much a flood would cost you depending on your square footage and how many inches of water was in your house). Feel free to contact me if you need to as well. I truly enjoy helping people.
Let me know that Dana, Alan, and Tamara sent you as their referral is very important to me.