A recent study found that climate change cost the US close to $75 billion in flood damage from 1988 to 2017. What’s more, the researchers say that’s only a third of the financial losses from flooding.
So, if you’ve been wondering, “do I need flood insurance?”, those figures may be enough of an answer. If not, then know that there are many other reasons to invest in this type of coverage.
This guide lists the top reasons you need flood coverage, so be sure to read on.
1. It May Be Mandatory
By law, flood insurance is mandatory for certain homes in high-risk flood areas. These include residential properties with active government-backed mortgages. This mandate applies to mortgages insured by the following federal government agencies:
- Federal Housing Administration (FHA)
- U.S. Department of Agriculture (USDA)
- Department of Veterans Affairs (VA)
So, if you have a mortgage backed by any of those agencies and you live in a high-risk zone, you must have flood insurance.
2. Your Flood Risk May Be Higher Than What You Think
Up to six million US homeowners may not be aware that their properties are in a flood risk zone.
Researchers say that’s primarily due to the outdated Special Flood Hazard Areas list. Currently, the maps show only 8.7 million properties in those hazard areas. However, up to 14.6 million properties could actually be in those locations.
Those numbers could swell further as climate change brings more inclement weather. As such, even if your home is in a low-risk zone now, things can worsen, elevating your risks significantly.
So, before any of that happens, it’s time to make the smart move of getting flood insurance.
3. Standard Home Coverage Excludes Flood Damage
Flood insurance exists to help cover losses caused by floodwater damage to properties. These incidents can occur due to coastal storms, heavy rains, and river floods. You may even purchase coverage for damage that may arise due to melting snow.
However, all those protective features aren’t part of most standard homeowners’ policies. As such, you need to buy flood insurance as supplemental or separate coverage.
4. Costs Only a Tiny Fraction of What It Otherwise Covers
In 2018, the average flood coverage amount totaled $257,000, while the average premium was only $642. Doing the math, the average premium is only about 0.25% of the average flood coverage amount. That proves just how flood insurance is but a small price to pay for the massive coverage it can provide.
Just be sure to explore all your flood insurance options to find the most affordable policy. You can also check out and read this information to learn how to save 20% to 50% on your policy.
Stop Asking Do I Need Flood Insurance? Start Shopping for One Today
As you can see, it shouldn’t be a question of “why do I need flood insurance,” but more of “how much flood insurance do I need?” That’s because no matter how low your flood risk is, it’s a risk you don’t want to take on.
So, as early as today, protect your assets by purchasing adequate flood coverage. A reliable flood insurance expert can help you determine how much coverage to get.
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