Commissioner Urges Floridians to Buy Flood Insurance

April 30, 2007

Florida Insurance Commissioner Kevin McCarty urged Floridians to purchase flood insurance to protect their homes.

McCarty’s warning comes in anticipation of the 2007 hurricane season which officially begins June 1. The Commissioner also wants Floridians to be aware that there is a standard 30-day waiting period before coverage takes effect.

“If Floridians want flood insurance by the beginning of hurricane season, they need to purchase it by May 1,” McCarty said. “We learned several lessons from the 2004-2005 hurricane seasons, one of those lessons was that many people were unaware that flood damage is not covered by homeowners’ policies. Buying flood insurance is easy, affordable, and provides an extra layer of security in the event of a catastrophic event.”

During the aftermath of Hurricane Katrina, one research report cited up to 80 percent of properties damaged in Mississippi, and 60 percent of properties in low-lying New Orleans did not have flood coverage. This also spawned litigation, whether specific damage was caused by hurricane force-winds or the accompanying storm surge. Some litigation in the gulf coast states is still pending.

“In Florida nearly one-third of Florida’s homes do have flood insurance, but that still leaves two-thirds of families without this coverage. Even people outside of the flood zones should consider obtaining coverage,” McCarty added.

A Rand Corporation study showed one-third of all floods occurred outside standard flood hazard areas; however, only 1 percent of people outside the flood plains buy insurance.

With the recent reforms on the federal level, Florida consumers can purchase flood insurance for up to $335,000 in property damage, and $135,000 for personal contents. Most flood insurance policies may cost less than $1,000 a year in the flood zone and less than $200 a year outside the flood zone depending on the coverage selected.

Source: Florida Office of Insurance Regulation

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