When I think of a hurricane, I picture giant waves rolling over a seawall, large beaches being washed away and palm trees being blown down by powerful wind gusts. There is also the image of flooding as we all remember the travesty that Hurricane Katrina brought down on New Orleans and the surrounding low-lying areas. But here is the thing about Hurricane Harvey... it is the pure amount of rain, not coastal waters, that has caused the most damage. So, the question is - does it rain where you live?
The Bad News for Texans
According to The Washington Post
, there may be as much as $40 billion in damage from Hurricane Harvey with 80% of property owners not having any coverage. Most of these home and business owners have property insurance, but damage from flood is specifically excluded. Even as an insurance agent, if I were not directly on the beach, I bet I would not have been properly covered by making the assumption that most did. How much water can really fall from the sky?
We all make decisions based on information and weigh it based on our own experiences and perceptions. I would bet that not many property owners were encouraged to purchase flood insurance because many were not in a "high-risk" flood zone according to the mapping done by FEMA. The FEMA maps reflect the known flood risk of most areas; however, there is a better understanding of coastal storm surge areas and rivers overflowing - not necessarily drainage systems being overwhelmed by rainwater.
The few who did have flood insurance were most likely required to by their mortgage holders, but again, only if in a high-risk flood zone.
How will NH Property Insurance Respond to Flood?
In two short words- it won't. Most property policies written in New Hampshire specifically exclude all claims resulting from a flood. To have property coverage for a flood, homeowners and business owners would need a separate flood policy typically underwritten by the National Flood Insurance Program. These policies can be purchased through insurance agencies throughout the state, including HPM Insurance
Why Flood Insurance is not Just for Coastal Properties
Hurricane Harvey is a text book example of why flood insurance is not just for coastal properties. If a property owner experiences a flood and does not have flood insurance, it would be up to the property owner to find the means to rebuild. This could be done through personal savings or loans, applying for grants or other low-cost loans from the government - which are neither quick nor guaranteed.
If you are in a high-risk flood zone, and have a loan on your property, your lender most likely required you to carry flood insurance. If not, like many of the property owners in Houston, you probably never even thought about it. The good news is that flood insurance rates are primarily based on where your property is on a flood map. If you are in a "low-risk" flood area, which can be determined very quickly when getting a quote, the cost may be reasonable and worth the money for peace-of-mind alone. To make this decision, you at least need to understand the cost vs. assuming it is too expensive.
How Do You Get a Quote for Flood Insurance?
The vast majority of flood insurance is available through the National Flood Insurance Program (NFIP) and sold through insurance agents. It is free to get a quote and there is no need to shop around because the rate is set by the NFIP. If all the facts remain the same, the price will as well. That said, it is strongly advised that you go to an insurance agent that is familiar with flood insurance to help you navigate the coverage you need. FEMA's website has great information on what questions you should ask your agent to help get the coverage you need.
The Cold Wet Truth
Admittedly I live up on a hill and used to say that Noah himself would have to be floating by to have a flood. I will reconsider this position and at least get a quote. Hopefully you will too because though you may not live on the coast, I guarantee it rains where you live.
This material is for informational purposes only. All statements herein are subject to the provisions, exclusions and conditions of the applicable policy, state and federal laws. For an actual description of coverage, terms and conditions, please refer to the applicable insurance policy or check with your insurance professional. The illustrations, instructions and principals contained in the material are general in scope and to the best of our knowledge, current at the time of publication.