Why Buy Flood Insurance?
Did you know that floods are the most costly and common natural hazard in the U.S.? There have always been terrible floods, but the flooding after Hurricane Katrina was unbelievable. About 800,000 homes were damaged or destroyed. While many homes were insured against wind damage, far fewer were insured against flooding, the primary cause of the extensive damage.
How many insurance claims were paid after Katrina? 167,985 – that’s it. Less than one homeowner in four had insurance coverage for their losses.
Most floods aren’t that dramatic, involving far fewer homes. However, that doesn’t matter to homeowners who have lost their homes and prized possessions. Too often, uninsured homeowners say, “Everything I worked for in life is gone.”
If those people could turn back the clock and buy flood insurance, do you think they would?
5 Common Misconceptions About Flood Insurance
There are quite a few misconceptions about insuring against floods.
1. I Have Homeowners Insurance
A homeowners policy will cover water damage from a broken pipe inside the house. However, when the source of the water is outside the house, such as a storm or river, you aren’t covered. You need a separate flood insurance policy.
2. I Don’t Live in a Flood Zone
Lenders require homeowners living in an area at a high risk of flooding to buy flood insurance. However, every year, about 25% of all flood losses happen to people who don’t live in high risk flood zones. The picture of a devastated homeowner saying, “But this never happened before!” is all too familiar. A “100-year flood” might happen twice in three years. Storms and floods follow no schedule but their own.
3. I Can Put Off Buying Flood Coverage
Occasionally, a new homeowner will think they can wait to buy insurance against flooding until they learn a hurricane is heading their way. After all, they may have two weeks warning of a hurricane, so they can get a flood policy then. However, there is typically a 30-day waiting period on new flood policies issued during hurricane season. That means you wouldn’t have any coverage for the first month after getting the policy. You’d have to pay for all damages yourself.
4. The Government Will Cover My Losses
The government does step in and provide some disaster relief, but it’s a mistake to consider that a substitute for flood insurance.
- Government assistance may be difficult to get and take quite a while to process. Also, it will only cover a fraction of what you would have received under a private insurance policy.
- You get no disaster relief unless the government declares a “disaster.” That only happens in 50% of floods, meaning there is a 50% chance you won’t qualify for any government aid.
- Renters and Business Owners Can’t Get Flood CoverageIt’s not necessary to own the home or building to buy a flood policy for the contents. Paying a small premium would be much better than trying to replace everything by yourself.All Flood Insurance is Not Alike
There are two types:
1. Government Flood Insurance
Government insurance is offered under the National Flood Insurance Program (NFIP) and run by FEMA. It is normally available only in high risk flood zones. The debt-ridden NFIP has been in danger of lapsing several times, requiring emergency extensions by Congress. Coverage is limited to:
- $250,000 of coverage for the home
- $100,000 of coverage for belongings
- No coverage for damage to the land itself, pools or unattached structures
- Traditional Private Flood InsurancePrivate insurance against flood damage is becoming more common. It offers more extensive benefits than government insurance and coverage is available for any area. Private flood is reaching areas the NFIP can’t. Sometimes, great coverage can be expensive but it doesn’t compare to the losses that will be paid in the event of a flood.The Neptune Difference – High Tech Expertise and Affordable Coverage
Neptune Flood uses advanced technology to make private flood insurance affordable. The innovative, on-demand platform makes it easy. Neptune offers increased benefits and acceptance by mortgage lenders. Neptune is backed by one of the world’s largest insurance markets.
- 5-day waiting period vs. 30 day waiting period
- Premium savings of up to 25%
- Up to $500,000 of coverage for the home (NFIP: only $250,000)
- Up to $200,000 of coverage for contents (NFIP: only $100,000)
- Up to $10,000 basement contents (NFIP: limited)
- Up to $10,000 pool repair and refill (NFIP: Zero)
- Up to $50,000 unattached structures (NFIP: Zero)
- Temporary living expenses
- Optional deductible coverages
Don’t put your financial future at risk. Protecting your home and belongings from flood damage is a safeguard against a loss you can’t afford. Neptune Flood offers the flood coverage you need at a price you can afford.