Considering the most recent flooding occurrences around the nation, it’s probably time to take a closer look at your current flood coverage, if in fact you have it.
First, if you haven’t already, you’ll want to identify what flood zones both your “parcel” and/or “structures” are located in. It is also important to identify if these are either “partially” or “wholly” in a high hazard zone (SFHA-Special Flood Hazard Area). The reason behind this is that many flood coverage forms exclude coverage if the parcel and/or structure is partially or wholly in a high hazard flood (SFHA) zone.
The other dilemma is that a larger deductible may apply if, in fact, the coverage provided is for a parcel/structure in high hazard zones. Many times the deductible can be listed as “the maximum available limit through the National Flood Insurance Program” (NFIP). This can be excessive as the maximum available via the NFIP for most apartment communities is $500,000 per building!
It is also important to note that over the last few years the Federal Emergency Management Agency (FEMA) has amended many of the zones. You may have previously been in a low to moderate zone but may now be in a high hazard or vice versa. Asking your agent to run a current flood mapping for you can assist in this process.
In addition to the above tasks, it’s really important to confirm that all lines of property are covered…buildings, outbuildings, contents and loss of income. Many flood insurance coverage forms (including the NFIP form) are limited to just building coverage, but most of the independent forms are much more flexible.
Lastly, make sure you are aware of the definition of flood as it is defined within your insurance policy. Yes, you’ll need to read your policy to determine this. For the most part, it is usually defined as “the overflow of a natural (or unnatural) body of water including the breakage or overflow of their boundaries or the rapid accumulation of surface water on otherwise dry land whether wind driven or not,” an example of which would be heavy rains.
For flood questions, or if you would like a review of your flood insurance policy, our team is here to help. Please contact Dawson Real Estate Insurance Division by emailing Jeff Reisner or by calling our office at 800-860-0090.