Just because you don’t live close to water doesn’t mean you don’t need flood insurance. Just ask homeowners caught in Hurricane Sandy’s path earlier this month that live in areas considered a minimal risk of flooding, but found themselves under water.

“Twenty-percent of all the claims being reported to us [resulting from the superstrom] are coming from areas where the risk is moderate to minimal,” says Terry Tyson, senior agent for FloodSmart Insurance. “These are people who actually purchased flood insurance and now have a claim. The rest of the people in these areas have no flood insurance at all.”

The destruction Sandy left in her wake and the financial toll it’s taking on the uninsured has homeowners across the country reevaluating their risk and weighing whether or not they need flood insurance. 

According to the National Flood Insurance Program, if you live in a high-risk flood area, your home is more than twice as likely to be damaged from water as a fire. What’s more, according to NFIP from 2007 to 2011, the average residential claim from a flood was close to $30,000.

Flood damage is not covered by standard homeowner’s insurance and most mortgage lenders require homeowners living in flood zones to have flood coverage. You can purchase insurance through the National Flood Insurance Program or NFIP or through private insurers.

Created in 1968 by Congress, the National Flood Insurance Program offers insurance to homeowners, renters and business owners so that they have protection from the floods due to hurricanes, tropical storms and heavy rains. In order to access the flood insurance, the community has to participate and agree to take measures and enforce ordinances that meet or exceed the requirements of FEMA to reduce the risks of flooding.  You can check here to see if your community participates. 

According to FEMA, nearly all of the country’s communities that have a serious potential for flooding have joined the NFIP. If your community doesn’t participate in NFIP that doesn’t mean you are out of luck, although coverage could be more costly if you purchase flood insurance from private insurers. “If the community does not participate in the flood program, flood insurance will be much more difficult to purchase, and much more expensive,” says Tyson. “This market is generally covered by private surplus lines carriers.” 

The amount you’ll pay for your flood insurance various on your location, but according to NFIP, the average flood policy costs around $600 a year. Tyson adds that flood insurance for properties in very high risk areas can cost $2,000 to $10,000 per year. 

If you live in a coastal area and want coverage for the building and its contents it will cost $7,173 a year for $250,000 in building and $100,000 of contents coverage, according to NFIP. A person with a home in a moderate to low risk area with a preferred risk policy will pay $417 a year for the same amount of coverage.  

Flood insurance is broken down into building coverage and optional content coverage. Building coverage insures the home and its foundation, as well as the electrical and plumbing, central AC, furnace and water heater, refrigerator, stove and dishwasher and permanently installed carpeting and paneling. It will also cover window blinds and the removal of debris, according to Tyson. Optional content coverage will cover your clothing, furniture, electronic equipment and portable appliances. It will even cover certain valuable items like artwork and furs up to $2,500, he says.

While filing a flood insurance claim won’t increase your premium, it doesn’t mean your insurance won’t go up on a regular basis because premiums typically increase yearly.

“With the most recent renewal of the National Flood Insurance Program, premiums will be increasing significantly,” says Tyson. “Vacation homes and second homes may very well see rate increases of 25% per year until the rates become actuarially sound.”

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