Floods are one of the most pervasive natural disasters; striking unexpectedly in every climate short of drought. Heavy rain, storm surge, melting snow, broken pipes and more can all cause flooding—and all happen unexpectedly. In fact, flooding caused such a fiscal drain on the populace that Congress created the National Flood Insurance Program (NFIP) in 1968, which now funds all flood insurance policies through FEMA. Even an inch of water can cause irreparable damage to your belongings and (without the proper insurance policy) your bank account!
Living in New England, and with September being both Atlantic Hurricane Season and National Preparedness Month, it’s especially important to make sure your home and business are covered. Here’s everything you need to know about flood insurance and protecting your belongings from unwanted water:
Cheaper Than You Think
It’s not easy to spend money protecting against something that hasn’t happened yet, but it’s important to put the cost into perspective. The average duration of a US Small Business disaster home loan is 30 years at a 4% monthly interest rate. In comparison, a NFIP flooding policy carries an average premium of $500 a year.
My Property Has Never Flooded
Flooding is the most common form of natural disaster–accounting for roughly 60% of reported disasters over the last few years according to FEMA. With climate change and human construction destroying meadows, flooding is a disaster that is continuing to grow in frequency. Just because you haven’t experienced flooding does not mean it won’t happen.
Know Your Property Zone
There are three different types of flood zoning that dictate the price of your policy. Each zone is defined based on a predetermined level of flooding risk in that area.
Special Flood Hazard Area (SFHA)
An SFHA means that the property either has a repetitive loss history or the occupant has received federal disaster assistance for flood loss in the past. These zones require the most expensive coverage due to the high likelihood of repeated flooding.
Non-Special Flood Hazard Areas (NSFHA)
A NSFHA, also referred to as a Preferred Risk Policy (PRP), means the property is at a low to moderate risk of flooding. This is the most common type of zoning and usually carries the lowest policy premium.
Preferred Risk Policy Extension (PRP)
A PRP Ext. Zone means that the property was previously in a preferred risk zone. If this is the case, you likely qualify for a preferred risk rate!
If a previous tenant had flooding coverage on your property, be sure to check with the insurer. In most instances, the new tenant can take over the old policy at the same rate.
Always determine what type of flooding zone your property is before purchasing any new land or obtaining your flooding policy.
Flood coverage is not a nice-to-have, but a must-have for both homes and businesses on the first floor. Take the time to prepare your home with these tips from FEMA and protect your future by looking into a flood insurance policy for your home or office. At Eastern Insurance, we have a flood unit on staff that are highly trained in all aspects of flood protection in Massachusetts and Rhode Island. They’re ready to help you get all of the information you need to protect your property. Give us a call! 800-333-7234.