Flood? What would Noah do?

The most famous flood of all time prompted the Head of Risk Control to forewarn at least one resident to be prepared. You might say that Noah’s “insurance” came two-by-two to ensure recovery from the devastation. Unfortunately, today, too many of us discover we’re not insured only after a flood occurs. So what is flood insurance all about?

Flood insurance is NOT part of a standard homeowners insurance policy. You have to buy flood insurance separately and there’s a 30-day waiting period for protection once the policy is in force unless it is being purchased as part of a real estate closing process.

You don’t have to live near a body of water to have a flood. You just have to be in harm’s way when water seeks the shortest distance to the lowest point. That point may begin with your basement but also may compromise or destroy the structure itself.

We don’t want to be alarmists but who would have thought that sections of the New York and New Jersey coastlines would be battered by tidal surges as high as the upstairs bedroom? Or what about the rain-induced floods from tropical storm Irene that devastated coastal and inland areas of New England in 2011?

Though federal disaster relief helps with clean up and recovery, it is unlikely to fully restore the value of the homes that were damaged or destroyed. And, federal assistance often is a loan that must be paid back. That’s why flood insurance is so important.

Where do you get flood insurance and how much will it cost?

From FEMA: The National Flood Insurance Program (NFIP), managed by the Federal Emergency Management Agency (FEMA), enables homeowners, business owners, and renters in participating communities to purchase federally backed flood insurance. This insurance is designed to provide an insurance alternative to disaster assistance to meet the escalating costs of repairing flood damage to buildings and their contents.

For many homeowners, there is no option about buying flood insurance as any property in an identified flood zone is difficult or impossible to finance without the coverage. In 2009, re-mapping of York and Cumberland counties in Maine caught many property owners by surprise. According to a Press Herald story, FEMA was “widely criticized as wrongly placing many homeowners, businesses and entire communities in high-risk flood areas requiring expensive insurance or prohibiting new development altogether. FEMA wound up withdrawing those maps in 2010 for more work. [The revised maps] are due back out in late 2013 and are supposed to be effective in the summer of 2014, according to FEMA.”

According to a recent news bulletin from Maine state government, the average annual premium for flood insurance is $930 though some properties can be far more expensive to cover. The standard coverage, however, only pays for the actual cash value of damaged property (original cost less depreciation) and will only pay for essential systems repair or replacement for damage in the basement. “Man caves”, playrooms or other improvements below grade are not going to be insured under standard coverage. Independent agents, such as Clark Insurance, will help you understand and access this additional insurance protection.

So, what’s the technical definition of a flood according to FEMA?

A general and temporary condition of partial or complete inundation of two or more acres of normally dry land area or of two or more properties (at least one of which is the policyholder’s property) from overflow of inland or tidal waters; or unusual and rapid accumulation or runoff of surface waters from any source; or mudflow; or collapse or subsidence of land along the shore of a lake or similar body of water as a result of erosion or undermining caused by waves or currents of water exceeding anticipated cyclical levels that result in a flood as defined above.

It is estimated that about 75 percent of homes located within known flood zones do not have flood insurance.

March and April are the most likely months for flooding when snow pack and rain often combine to fill flood plains but a flood, as we’ve seen, can happen just about anywhere at any time.