Who Needs Flood Insurance? Everyone!
Release Date: April 19, 2001
Release Number: 1364-05
» More Information on Massachusetts Severe Storms & Flooding
Quincy, MA -- After a flood, insurance can go a long way toward putting the pieces back together. Nobody can erase the bad memories, the trauma of the event, but insurance can help pave the way to a fresh start. Insurance can reimburse policyholders for emergency measures taken during the flood, as well as damaged personal property and repairs to covered buildings and businesses. President Bush declared three Massachusetts counties a disaster area on April 10 following storms and flooding, March 5 - April 16.
In Essex County there are 4,818 flood insurance policies in effect covering property valued at more than $655 million. In Middlesex County there are 3,003 policies in effect covering property valued at almost $401 million. Norfolk County has 3,796 policies in effect protecting almost $446 million in property. In the Commonwealth of Massachusetts, 740 flood insurance claims have been filed since the storms and flooding began on March 5.
"Year in and year out, flooding is the leading cause of property loss from natural disasters in this country," said Federal Coordinating Officer Louis H. Botta of the Federal Emergency Management Agency (FEMA). "But all too often, homeowners learn after the fact that protection against flood loss is not part of their normal insurance protection package."
"The recent flooding events we have experienced in the Commonwealth continue to highlight the need for homeowners to be better prepared. Flood insurance is one such tool," said State Coordinating Officer and Director of the Massachusetts Emergency Management Agency, Stephen McGrail.
Important features of the National Flood Insurance Program are:
- Anyone can get flooded, and anyone can get flood insurance. Even if you have been flooded before, live in a flood zone, or if your flood risk is high, medium, or low, you can purchase flood insurance if your community participates in the NFIP. In order to participate, the community must adopt and enforce local floodplain management ordinances designed to reduce the risk of future flood losses. Check with your local officials to see if your community participates in the NFIP, or call the NFIP toll-free hotline, 1-800-427-4661.
- Flood damage is not covered by homeowner's insurance policies. You can protect your home, business, and belongings with flood insurance. You can insure your home for up to $250,000 for the building and up to $100,000 for the contents.
- Contents coverage is separate. It is not automatically included with building coverage. Ask your agent. Renters can insure their belongings, too.
- Flood insurance pays even when no disaster is declared. Statistically, federal disaster declarations are issued in less than 50 percent of flooding incidents. An NFIP policy will pay for flood damage whether or not there is a federal disaster declaration.
- Flood insurance is affordable. The average flood insurance policy costs a little more than $300 a year for about $100,000 of coverage. A policy for a dwelling in low- to moderate-risk areas may be as low as $100 a year.
- There is a 30-day waiting period before a flood insurance policy becomes effective. You can purchase flood coverage at any time, but there is a 30-day waiting period after you have applied and paid the premium before the policy becomes effective.
- Call your own insurance agent. NFIP flood insurance is sold through private insurance companies and agents, and is backed by the federal government.
- Insurance is less expensive than federal disaster loans. Average annual premiums for NFIP coverage are significantly less than loan payments, even though those loans are granted under favorable terms.
- Eligibility for secured financing to buy, build, or improve structures in special flood hazard areas - Lending institutions that are federally regulated or insured must see evidence of NFIP coverage before they grant secured financing.
Federal Coordinating Officer Botta also noted that provisions in the National Flood Insurance Reform Act of 1994 require that homeowners who live in communities that participate in the NFIP and receive a grant through the Individual and Family Grant program following a Presidentially declared disaster must purchase and maintain flood insurance for the life of the property. If they do not, they will not be eligible for certain types of federal disaster assistance in the future. If the property is sold, the seller must inform the buyer of the requirement to maintain flood insurance coverage. Persons who obtain a U.S. Small Business Administration disaster loan may be required to purchase and maintain flood insurance for the life of the loan.
For complete information, call the National Flood Insurance Program toll free at 1-800-427-4661.
Massachusetts residents who sustained damages from the March storms and floods may still register for assistance by calling 1-800-462-9029. The TTY number for hearing- or speech-impaired is 1-800-462-7585. Both numbers are available from 8 a.m. to 6 p.m., seven days a week until further notice.
Last Modified: Monday, 27-Oct-2003 13:06:42