Should you buy flood insurance now?

When you review your monthly budget you may be putting money aside for items such as groceries, rent, clothing, and your gym membership, but have you ever listed flood damage on your budget? According to a spring 2010 edition of the Western Pennsylvania AAA Motorist magazine, flooding is the most prevalent natural disaster and you are 3 times more likely to be affected by flooding then fire. We certainly hear about the floods that reach the magnitude of the horrible May 2010 disaster in Nashville, but flooding comes in all sorts of intensities.

Except for vehicles with "comprehensive" insurance in their policy, flood damage is not part of typical insurance coverage, and everyone is at some level of risk of financial loss due to flood damage. You can be the most financially conservative person, but one flash flood could severely harm you, financially speaking. The average flood damage claim is $33,000.00. Most people will not have that much money set aside, even before a natural disaster hits. Also, nearly all disaster relief money is considered a loan and must be paid back to the issuing authority. Fortunately, there are steps you can take to protect yourself and quickly recover and a flooding disaster.

Here are facts found from FEMA's and the CDC's websites:
Why should you be concerned about flooding?
-Only flood insurance will cover flood damage.
-25% of all flooding claims come from moderate to low risk areas.
-You do not need to be next to a body of water for flooding to occur on your property.
-Melting snow / poor drainage / deteriorating natural or man made barriers are just a few of the least expected sources of flooding.
-All 50 states have been affected by flooding.
-While risks vary, according to www.FloodSmart.gov, we all live in a flood zone.

Considering buying flood insurance? Keep an eye on what is going on with this program. Flood insurance is issued by the National Flood Insurance Program and funding must be approved by Congress. Currently, funding for the National Flood Insurance Program is scheduled to stop in September 2011.

From the Insurance Information Institute
In the absence of any legislative agreement between the House and the Senate on funding the program for the long term, the NFIP was reauthorized for short periods of time under a series of continuing resolutions that extended funding for many different programs. After allowing the program to lapse four times, during which new policies could not be issued, leaving homeowners without the option of buying coverage and delaying thousands of real estate closing per day in flood-prone regions, in September 2010, as the last extension was close to its expiration date, both the House and the Senate extended the program for one year to September 30, 2011. Insurers hope that during this longer extension period Congress will take time to make significant and long-term changes in the program. http://www.iii.org/issues_updates/flood-insurance.html

Other articles you may be interested in:
-Is damage from a pothole covered by my car insurance? Yes, but........
-Explaining pet insurance.
-What to do before a car accident.
-What grade is your insurance company receiving?
-How to "wreck" your auto insurance claim.

 
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