The National Weather Service has designated this week, March 18–22, as Flood Safety Awareness Week. New York recently experienced three major storms that resulted in significant flooding across the state.
Flooding is not specific to storm activity. Floods can occur for a variety of reasons, including the arrival of spring and warmer temperatures, when the season’s rains combine with moisture-saturated soil from the winter snowfall. Snow may still be flying in areas of the state, but warmer weather will be arriving soon.
“The fact is more than 20 percent of all flood insurance claims are filed in areas with minimal to moderate flood risk,” Ellen Melchionni, president of the New York Insurance Association (NYIA) said. “There’s also a 30-day waiting period for flood insurance policies to go into effect, so it’s important that individuals act before the threat of flood to call their insurance agent or company representative.”
Currently more than 175,000 flood insurance policies issued by the National Flood Insurance Program (NFIP) are in force in New York State, up from more than 168,000 before Sandy struck last year. Most homeowners have not opted for flood insurance protection with only 8 percent of homes being covered in the Northeast as of November 2012.
The NYIA offers the following flood information:
· Standard homeowners and renters insurance does not cover flood damage. Flood coverage is available in the form of a separate policy both from the National Flood Insurance Program (NFIP) and from a few private insurers.
· The comprehensive portion of a standard auto insurance policy does cover flood damage.
· Flood insurance can be affordable. The annual premium for a flood policy starts at $129 for low risk properties, and increases with the level of flood risk and amount of coverage needed. For homeowners, the maximum amount of coverage is $250,000 for the structure of the home and $100,000 for the contents. For businesses, the maximum amount of coverage is $500,000 for the structure and $500,000 for the contents.
· An NFIP policy provides replacement cost coverage for the structure of a home, but only actual cash value coverage for possessions. Replacement cost coverage pays to rebuild a home as it was before the damage. Actual cash value is replacement cost coverage minus depreciation, so the older the possessions are the less individuals will get if they are damaged. There may also be limits on coverage for furniture and other belongings stored in a basement.
· There is a 30-day waiting period for flood insurance to go into effect, so it is important that individuals do not wait until flooding in their area is imminent to get the coverage.
· For individuals who want to purchase greater coverage than the amounts offered by an NFIP policy, excess flood insurance is available from private insurance companies. It can even be purchased in high risk flood zones along the coast and close to major rivers as well as in areas of lower risk. Excess flood insurance is available from specialized companies through independent insurance agents or from standard homeowners insurance companies that have arrangements with a specialized insurer to provide coverage to their policyholders.
· Keep in mind that before most forms of federal disaster assistance are offered, the president must declare the area a major disaster – and only a small percentage of all disasters are officially declared a major disaster. If your area is declared a disaster, no-interest or low-interest loans are usually made available by the federal government. Grants are also sometimes available. It is important to note that these loans or grants are not a guarantee. If you have flood insurance, your claims are paid whether or not the area is formally declared a disaster area.
Source: The New York Insurance Association (NYIA)
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