There may have been some hints of blue sky last week, but don’t be fooled. Flood season continues in Western Washington through March. And that brings the threat of property damage for some home and business owners.
January is a good time to evaluate your financial situation and your insurance coverage. What many people don’t realize is that home insurance typically doesn’t cover landslides, mudflows, earth movement and floods.
“It’s really important for homeowners to understand that the insurance policy is a contract between them and their insurance company,” said Karl Newman, president of the NW Insurance Council in Seattle. “It’s really important to know what’s in your policy.”
Those who live inside or near a high-risk flood area can get insurance through the National Flood Insurance Program. The program offers insurance to people who own or rent a home or business property, even if it has been flooded before.
Although certain areas flood every year, part of the reason flood insurance is not included in a standard homeowner’s policy is that floods are not typical. “Floods and earthquakes are very hard to predict,” Newman said.
Insurance agents can write flood insurance policies approved by the federal government for their customers. Homeowners can also contact the National Flood Insurance Program themselves and get information. In some flood-prone areas, the flood insurance is a federal requirement for ownership or home improvements.
The program’s coverage can pay up to $250,000 in damage to a house and up to $500,000 damage to a business.
Michael O’Leary / The Herald
“It is a huge step over not having any coverage at all,” Newman said.
Those who live in a high-risk area might have the option of selling their homes to the federal government or raising the foundation to reduce the risk of loss to flooding.
Up to 25 percent of all flood insurance claims are filed in low- to moderate-risk areas. In low-risk areas, the cost of the insurance can be about $100 per year. Where the risk is higher, the cost of insurance can range from $400 to $1,000 a year.
Skipping insurance can be costlier than paying the premiums; uninsured homeowners who are hit by floods or landslides may be able to get a low-interest disaster loan for repairs, but they must continue to pay their mortgages.
“It’s a whole lot more than the $1,000 per year,” Newman said.
Approximately 4.7 million policyholders in the United States have coverage from the Federal Emergency Management Association insurance program. For the last 10 years, flood losses in the country have averaged $867 million a year. Flooding is the leading natural disaster in terms of cost in the United States.
“We see it here as an event that happens pretty regularly,” said Carl Cook, mitigation director for FEMA’s regional office in Bothell.
Cook said people who suspect their home might be vulnerable to floods because they live next to an area that could flood should consider flood insurance.
FEMA’s program will also cover mudflows, but those events are very narrowly defined.
“There is limited coverage for mudflow,” Cook said. “It doesn’t cover the typical event, which is really a landslide.”
For people who believe they need the coverage, Cook suggests that owners should consider insurance for the house and their belongings, and renters should insure the contents of their homes.
For people who are buying a home, the real estate agent can tell a new owner if the property is in a flood plain. “Lending institutions are required to tell you that the home is in a flood plain,” Cook added.
For current homeowners, a trip to city hall or the county courthouse to check out flood maps is also a good idea; the maps show areas of past flooding.
FEMA is in the process of mapping many flood plains, Cook said. The most recent maps were completed in the 1980s, but the area’s geography has changed since then. Snohomish County has a new map that should be out soon.
The purpose of re-mapping is to put the most accurate information in the hands of the public, Cook said.
If after investigation home or business owners want to get flood insurance, they should know it takes 30 days for a policy to take effect.
“And that’s to keep people from waiting until the water is lapping at their doorstep,” Cook said.
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