Why Do You Need Flood Insurance?
Why Do You Need Flood Insurance?
According to Edward L. Connor, Deputy Administrator, Insurance, for the Federal Insurance and Mitigation Administration, “Floods can bring, mud trash and, if you don’t have flood insurance, debt.”
If your home floods, you will incur debt to recover after a devastating flood. Many people do not have enough in their savings accounts to pay the costs of recovering from a flood.
According to FEMA, “Over the past five years, the average paid claim for flood damage was $33,790.”
Your Mortgage Lender May Require You to Get Flood Insurance if Your Home is in the 100-Year Flood Plain
In order to pay for all the claims, FEMA has conveniently almost tripled the width of the flood plain, so that if you didn’t think you needed flood insurance in years gone by, you will be convinced by your mortgage lender that you need flood insurance now.
So rather than making the choice to get flood insurance, the federal government, along with the insurance industry has made it easy to decide. Flood insurance may be mandatory when a structure is in the flood plain.
Federal law requires people who own homes with a mortgage through a federally regulated and insured lender to carry flood insurance.
In short, if you have a mortgage loan and are now in a flood plain, you must carry flood insurance or your mortgage note is immediately due and payable. No kidding!
Even if you have lived in your home for sixty years and it has never flooded, you may have to carry flood insurance if you have a mortgage.
Your premium payments will help the federal government assist others who actually do get flooded out from time to time or once in a blue moon.
By purchasing flood insurance, you are not only protecting the home you love from the remote possibility of being devastated by a few inches of floodwater, but you are helping your neighbors in New York, New Jersey, Iowa, and Louisiana.
By purchasing flood insurance, you are being a good citizen as well as protecting your savings account from potential catastrophic losses.
You No Longer Have the Choice if You are In a High Risk Area
So even if you live on the edge of a high risk area, where you only have a one in four chance of flooding during the course of a 30-year mortgage, you no longer have the choice. You have to get flood insurance.
Admittedly, without flood insurance, recovery costs must come out of your own pocket. Why save for the eventuality when you can purchase insurance for much more money and never have to worry about managing your own savings. Just wait and see if you experience a flood and wait for FEMA to help you out.
That’s why you need flood insurance. Don’t you feel so much more secure in knowing that the federal government can better handle your money than you can? Just trust the National Flood Insurance Program.
If you don’t believe me and want to learn more about flood risk and flood insurance, go to Floodsmart.gov/highrisknow. To find agents in your area, call 1-888-724-6975.
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