NEW YORK – Among the lessons to be learned from Hurricane Katrina is that more Americans need to consider buying flood insurance.
The storm, which struck Louisiana, Mississippi and Alabama late last month, caused billions of dollars in damage to houses, not only along the Gulf Coast but also miles inland. Then Hurricane Rita hit Texas and Louisiana last week, causing further destruction.
Many families are learning to their dismay that their homeowners insurance covers damage from hurricane winds and wind-driven rain, but not damage from storm surges and flooding.
And although the federal government has made flood insurance available for more than three decades through the National Flood Insurance Program, many Americans haven’t signed on. In fact, in some hard-hit counties in Mississippi and Alabama, less than 15 percent of families had flood coverage, according to government estimates.
“What Katrina and Rita together are going to reveal is the shocking lack of flood coverage among homeowners, even those very likely to have their homes threatened by flood,” said Robert Hartwig, chief economist for the Insurance Information Institute in New York.
In some cases, mortgage lenders insist that home buyers purchase flood insurance along with standard homeowners policies. But some people let the flood insurance lapse.
That, said Hartwig, is like concluding that “my house didn’t burn down in the last couple of years, so why should I continue paying for insurance?”
The storms have prompted thousands of homeowners outside the Gulf area to check out flood insurance. Even people who don’t live on the coast can suffer damage, when rivers and flood plains overflow from melting snow or heavy rains.
Homeowners can determine how vulnerable their houses are to flooding by plugging their addresses into the Web site run by the National Flood Insurance Program, which is a part of the Federal Emergency Management Agency, at www.fema.gov/nfip. The site also lists the cost of coverage, which can be purchased through most agents who sell regular homeowners insurance.
Coverage is available for up to $250,000 on a house and $100,000 on contents. Renters are eligible to buy up to $100,000 coverage on their possessions.
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