Knowing the ins and outs of flood insurance

Question from Lindsey J. from Fishers:

All the flooding and problems from the hurricane have got me thinking about a flood policy.  We have a basement and have never had any problems in the ten years we’ve lived in the house.  What do you think?                                    

Response from Jamie Ianigro:

Issues: The first thing you need to know about flood insurance is what the policy covers.  A flood insurance policy will protect your property from flooding accompanying hurricanes, heavy rains and melting snows.  A standard homeowner’s policy specifically excludes coverage for all of these things.  Some insurance carriers will add flood coverage with an endorsement to your homeowner’s policy, but usually you will have to purchase a separate policy.

The other thing you need to know about flood insurance is what it doesn’t cover.  Flood insurance doesn’t cover water that rises up through your plumbing.  This type of loss is protected by using an endorsement to your homeowner’s policy called sewer & drain backup.  A loss from sewer & drain backup can be just as damaging as a flood loss.

Coverage Recommendations: Most of Hamilton County sits in a moderate-to-low risk area when it comes to flood risk (you can check your risk at www.floodsmart.gov) and qualifies for coverage at the preferred rate.  Preferred rate policies are the lowest premiums available through the National Flood Insurance Program (NFIP).  This policy will protect your house and its contents starting as low as $129 per year.  It takes 30 days after purchase for a flood policy to take effect, so don’t wait until the water starts rising.

Sewer & Drain backup coverage is a simple endorsement that you may already have included on your homeowner’s policy right now.  Standard coverage usually starts with limits of $5,000.  If you have a finished basement, $5,000 is probably not going to get you back to where you would like to be.  We usually recommend upgrading that coverage to $10-25,000 to make sure you are adequately covered.  Higher limits are definitely available.  The cost of this endorsement varies by carrier, but is usually a very low percentage of the total cost of your policy.

Claim Prevention: The most important thing to know is when to cut and run.  Your family’s safety is much more important than a house or anything you have in it.  The steps you can take to prevent flood claims are pretty easy and you’re probably already doing them.  First make sure your sump pump is working and has an adequate battery-powered backup, in case it loses power.  Next, make sure your gutters and downspouts are free and clear of debris and obstructions.  Lastly, make sure your downspouts are getting water far enough away from the house that the water is not returning.