Registrations Show Need for Flood Insurance
Twelve Flood Events in Ten Years Point to Deficiency
Release Date: October 16, 2008
Release Number: 1795-025
» More Information on Indiana Severe Storms and Flooding
INDIANAPOLIS, Ind. -- When flooding threatens, most people instinctively grab their loved ones and wallets and flee to safety. In a household without flood insurance, the owner may as well leave the wallet and carry the house and family to safety. The wallet cannot be saved.
Thousands of homes and businesses in Indiana have been damaged by one or more of the 12 floods that swept Indiana in the past 10 years, and most of these homes and businesses lacked the flood insurance needed to pay for repairs. Recent experience shows this trend continuing.
For example, 12,662 Lake County residents have requested Federal Emergency Management Agency (FEMA) disaster recovery assistance following the severe storms and flooding that occurred from Sept. 12 - Oct. 6. of this year. Yet fewer than 6,000 flood insurance policies cover property in that county. In LaPorte County, another disaster-declared county, the ratio is 950 applications for assistance to 175 policies. In Porter County, the ratio is 1,030 applications to 160 policies.
| County | Applicants for disaster assistance as of Oct. 15, 2008 | Flood insurance policies in affect in county |
|---|---|---|
| Lake | 12,662 | 5,558 |
| LaPorte | 950 | 175 |
| Porter | 1,030 | 160 |
Throughout the flood-prone Hoosier state, flood insurance is unappreciated and underutilized, say disaster assistance officials with the Federal Emergency Management Agency (FEMA). Officials in the Indiana Department of Natural Resources (DNR) agree. Only 28,546 property owners and renters - less than one in a hundred - among Indiana's three million owners and renters had flood insurance in September 2007.
"Flood insurance offers the best opportunity for home and business owners as well as renters to protect their biggest financial investment,"said Greg Main, state floodplain manager with DNR. "A standard homeowner's insurance policy will not cover flooding, and as little as two inches of water in a home can cause thousands of dollars in damage.
"Many floods do not result in a presidential disaster declaration, meaning that federal disaster funds will not be available,"continued Main. "The safest plan is to be covered by flood insurance, which provides coverage for eligible losses whether or not there's a disaster declaration."
FEMA officials say coverage is a relative bargain contrasted to underwriting your own losses, borrowing for repairs, or relying on the limited disaster assistance provided by federal and state programs. "A disaster loan requires repayment while a FEMA grant only provides enough money for temporary housing or basic repairs to make a lightly-damaged home livable,"explains Federal Coordinating Officer Steve DeBlasio. "Flood insurance is the best protection for your investment."
Most of Indiana's flood-prone communities participate in the National Flood Insurance Program (NFIP), making insurance coverage available to home and business owners and renters. Policies can be written with coverage up to $250,000 for homes and $100,000 for contents. Non-residential structures can be insured up to $500,000 for the building and $500,000 for contents. Renters can buy up to $100,000 of contents coverage.
"Having your community participate in the program is the key that unlocks the door,"said Main. "But property owners need to walk through the door and buy the coverage."
NFIP offers the policies through local insurance agents and says that most mortgage lenders require a standard flood insurance policy as a condition of the loan for properties in high flood risk areas, known as Special Flood Hazard Areas.
Outside of high risk areas, flood insurance is also available in participating communities and is not expensive. Preferred Risk policies in these low-risk areas cover homes and contents, with premiums as low as $119 per year. It takes 30 days for a policy to take effect after coverage is purchased. These policies have great value, say floodplain managers, because a fourth of all flood insurance claims in the U.S. each year are in low or moderate risk areas.
For more information about flood insurance visit, www.floodsmart.gov. This website offers an interactive tool to help estimate the damage caused by various depths of water in a home; a list of participating communities; and help to locate a flood insurance agent.
The toll-free number for flood insurance information is 1-888-435-6637. Indiana communities that want to join the National Flood Insurance Program can contact Greg Main at gmain@dnr.in.gov.
FEMA coordinates the federal government's role in preparing for, preventing, mitigating the effects of, responding to, and recovering from all domestic disasters, whether natural or man-made, including acts of terror.
Last Modified: Thursday, 16-Oct-2008 12:26:09