Do You Really Need Flood Insurance in New York?

In 2012, Hurricane Sandy hit New York City like, well, a hurricane. The economic losses in the city alone were estimated to be $19 billion while the state total hit nearly $33 billion. New Jersey was also hit and acquired $30 billion in damages.

For some victims, they were able to count on their flood insurance for financial assistance, even though the road to recovery would be long and difficult. But for those without adequate coverage, or without coverage at all, it seemed that finding a sense of normalcy again would be impossible.

Even when there is substantial warning that there is a strong chance for flooding, you can’t always protect your home and belongings. While there’s no insurance policy that can keep a hurricane from hitting your home, flood insurance can at least provide monetary relief should your home be damaged by Mother Nature’s wrath.

Here’s everything you need to know about flood insurance, including who needs coverage the most, how much it costs, and how to obtain it.

Doesn’t My Homeowners Insurance Protect from Floods?

Many New Yorkers mistakenly believe that their homeowner’s policy protects them from all manners of natural disasters, including floods. This is not the case. In fact, most policies only cover types of damage that is specifically named in the policy.

The average policy offers protection against fire, wind, lightning, vandalism, theft, and hail. Most of them specifically exclude flood coverage because flooding events are usually so widespread and completely destructive in nature.

That is why flood insurance is usually available through the National Flood Insurance Program. At least primary flood insurance coverage is available through the NFIP. Many New York home values exceed the limits of the NFIP causing New York homeowners, and some renters, to seek additional or supplemental flood insurance coverage.

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It is important to make sure that you have flood insurance protection outside of your homeowner’s insurance policy, first and foremost. You must also make sure that the coverage you have is adequate to help you financially recover in the aftermath of a major flooding event.

Do I Live in A Risk Area?

There are certain areas of New York and New Jersey that are more prone to flooding than others. Of course, property on New York waterfronts will rank higher for flood risks than inland areas. But even areas that appear to be far enough from the water could be at risk. Some of the most dangerous New York neighborhoods include:

  • Battery Park City
  • South Street Seaport
  • Tribeca
  • Upper Manhattan
  • Brighton Beach
  • Red Hook
  • Howard Beach

This doesn’t include every high risk or evacuation zone. Please refer to a NYC flood map to determine your individual risk.

There are also online tools you can use to evaluate your flood risk in New Jersey. Unfortunately, the flood risk zones in the state seem to be growing. As of today, residents in the following towns are at the biggest risk for flooding:

  • Ocean City
  • Atlantic City
  • Toms River
  • Long Beach Township
  • North Wildwood
  • Ventnor

Even if you don’t live in a risk area for natural and disaster-caused flooding, there is always a risk for flooding. Melting winter snow or heavy spring rains can create overflow in bodies of water, including retention ponds and irrigation systems, causing flooding.

According to the National Flood Insurance Program, about 20 percent of claims processed through the government program are from those living in low-risk areas, so never consider yourself completely safe.

Are There Exclusions or Limitations to Be Aware Of?

Yes. It surprises many to learn that flood insurance does not cover personal property or furniture in basements, crawl spaces, or walkout basements. This includes electronics, couches, and carpet.

There are also coverage caps. Federal coverage has a limit of $250,000 per building and $100,000 for contents. Businesses can get coverage for up to $500,000 for the property structure and an additional $500,000 to cover business contents.  

You should also be aware of deductibles. You’ll most likely have separate deductibles for contents and property. There are also limitations on certain types of items, like antiques, collectibles, and fine art. You can purchase additional coverage for these items as needed. Speak to your insurance broker for more information.

How Much Does Flood Insurance Cost?

How much is flood insurance in New Jersey or New York? According to FEMA, the average flood insurance policy costs approximately $500 per year. That amounts to a little over $40 a month (which is not bad when you consider how much flood damage could cost).

Of course, not everyone’s policy will be the same and, as such, premiums will vary depending on your level of risk and the coverage you choose (as flood insurance will cover exactly what that policy says it covered, and no more).

How Do I Purchase Flood Insurance?

Now that you know that flood insurance isn’t included in your homeowners policy, living in a low-risk area doesn’t mean you’re safe from a flood, and that the coverage is more affordable than most people think, it’s time to make sure you’re protected by purchasing a policy.

Luckily, flood insurance isn’t difficult to secure. Either speak to your current insurance company or reach out to several to get enough quotes to make an informed decision. If you would like more information about flood insurance provided by Honig Conte Porrino, you can find everything you need to know here.

You’ll rarely receive enough warning before a flood to stop the damage. The last thing you want is to go through the trauma of a flood, believe you have coverage, and find out you’re on your own when it comes to repairing your property and replacing your items.

Make sure you’re prepared for whatever Mother Nature throws your way by securing flood insurance in New York. We hope you never have to make a claim but if you do, you’ll be confident with flood insurance through Honig Conte Porrino.