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Flood Insurance

A Timely Peak Hurricane Season Reminder About Flood Insurance

Late August through September is typically the peak of the Atlantic hurricane season. While hurricanes in this area can happen at any time of the year, this is the season when development is most likely. With all eyes on the Atlantic, now is a great time to consider flood insurance in NYC.

Why Buy Flood Insurance in NYC?

Hurricanes account for eight of the ten most costly natural disasters to affect the U.S. Much of that damage is the result of storm surge, heavy rains, and flash flooding, all of which can cause damage on the coast as well as hundreds of miles inland a well.

While it’s true that many people live in upper level apartments and the risks of floods are less, there are still many, many New York property owners, businesses, and renters who are vulnerable to flooding when it occurs.

The costs, when floods occur, are great because the force of water is great enough that it not only causes water damage – in some cases it also causes structural damage. With enough force, water can relocate a home.

Doesn’t Homeowners Insurance Protect from Floods?

Many New Yorkers mistakenly believe that their homeowner’s policy protects them from all manner 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.

For instance, the National Flood Insurance Program has strict policy limits of $250,000 for housing structures that house one to four families and $100,000 for the personal effects or contents of the home. Businesses can get coverage for up to $500,000 for the property structure and an additional $500,000 to cover business contents. Renters can only purchase $100,000 in coverage for their personal effects through the NFIP.

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.

National Flood Insurance Program Limitations

In addition to the dollar amount limits for flood policies through the NFIP, there are also specific exclusions in most policies. This includes things like the contents of finished basements. If you live in a basement, or below ground apartment in New York City, you may not be eligible for NFIP coverage.

If you have items that are stored in the basement, those items may not qualify for coverage under your flood insurance either. It is always wise to ask questions about coverage and limitations when obtaining your flood insurance policy. No one wants to find out when making a claim and facing a staggering loss that the coverage you thought you had doesn’t exist.

Why Buy through the NFIP?

It is a good idea to purchase initial flood insurance protection from the National Flood Insurance Program, especially if you live in an area that hasn’t been designated as a high-risk area, because the government subsidizes much of the costs of your insurance. This could save you hundreds of dollars, or more each year on your coverage.

If the coverage offered by the NFIP isn’t adequate to meet your needs (and for the average New Yorker, it will not be), you might want to consider obtaining additional coverage through a private insurer.

When Should You Buy Flood Insurance?

Unfortunately, waiting until a hurricane or tropical storm is imminent is waiting until it is too late to buy flood insurance. Unless you’re purchasing or refinancing your home, you must wait 30 days from the date of purchase before a flood policy takes effect. What this means for you is that the time is now to act and protect your investment in your home and your personal property with adequate flood insurance protection.

Don’t make a delay that could prove costly for your family. Protect the investment you’ve made in your home today by purchasing adequate flood insurance protection.