Should you get Flood Insurance for your Home?

flooded livingroom

You may not realize that as a homeowner, you need flood insurance. Traditionally, homeowner’s insurance does not cover flooding. For complete peace of mind, it is always advisable to keep your property insured. The debate on whether to buy flood insurance or not, then becomes only a question of how much it costs, and is the risk of not taking this insurance worth it.

What about Homeowner’s Insurance

Homeowner’s insurance will provide you coverage for the impacts that the flood might have but not for the flood itself. To understand this, let’s say that if heavy rains cause a tree in your front lawn to fall down and poke a hole in your roof, the homeowner’s insurance will cover for that. However, if there is water on the ground and it gets into your house as a flood then the damage is not covered through the same insurance.

Technically, there are only low and high-risk areas for flooding but no location is completely risk-free. In most cases, if you live in a high-risk flood zone and require a mortgage on your home, your lender will require you to get flood insurance. On the other hand, if you live in a moderate or low-risk zone, then you have the option to buy such insurance. For most homeowners making the decision to get flood insurance or not is a real matter to deal with.

Top Reasons to get Flood Insurance

#1 It’s Relatively Inexpensive

One of the biggest reasons for people wondering not to get flood insurance is its cost. However, if you live in a low-risk area, you can get the insurance at a much cheaper rate too. To put this in perspective, the history of flooding in the United States shows that a quarter of natural disasters of flooding actually take place in areas that are not considered at high risk of flood. The reason for this is that while the risk determinants usually take into account proximity to larger water bodies, a season of heavy rainfall can make even a small creek overflow and swell into a proper flood. Therefore, even if your standard home insurance policy requirements do not necessitate flood insurance, and you can get it at a cheaper rate, the more prudent decision is to get it.

#2 Flood Damage is Destructive

Another reason for choosing to get flood insurance rather than skipping it is that most people cannot even fathom the level of damage that comes from a flood. While a hurricane might make your rooftop fly away and your lawn trees to fall down, a flood – even a non-severe one – can be worse. It could cause damage to the very walls of your house, all your furniture and belongings, power outage, and possibly also fry all your electronics too.

In one year alone, the estimated cost of flooding damages is close to 10 billion dollars in the US. According to FEMA estimates, even an inch of water inside your house can cost you up to $27,000. With such high-risk figures, spending on the proper insurance is the only sane option. In more risky areas, as the cost of potential damage increases so do the prices of flood insurance. But even with those comparisons, it is better to invest in flood insurance than forgoing it.

#3 Government estimates are just that – estimates!

If you are still unconvinced that living in low-risk flood areas does not necessitate flood insurance, here is one more piece of information that you may want to know. The government does its best to come up with estimates and risk analysis of different locations in the country. However, the landscape of the rivers and thereby the land areas is constantly changing, which means that the models and estimates that the government makes can quickly become outdated. Flood estimates are based on data projections from the past floods. They cannot constantly account for newer changes and therefore cannot predict future flooding with very high accuracy.

The only good takeaway then remains that in such areas, flood insurance can be bought cheaply as compared to areas already designated as high-risk. It is always advisable to invest in proper coverage and add protection to your home and valuables instead of risking losing a lot of valuables and also needing to pay heavily for repair and reconstruction.

Final Word

Better to have it and not need it than to need it and not have it! There is always the debate of pushing your luck and not spending the extra amount for the right insurance if it is not mandatory. However, research and history favor in getting flood insurance instead of skipping it. Now you understand the benefits.