From Tuscon to Flagstaff, Arizona is no stranger to flash floods. Many residents of the Grand Canyon State do not realize their homeowners insurance policy isn't sufficient to cover their losses from rising flood waters until the damage is done and it's too late. Only a comprehensive insurance policy with flood coverage can protect your home and assets from being swept away with the current.
Before you search for flood insurance quotes, however, there are several factors to consider.
Flood History and Local Statistics
According to the National Flood Insurance Program:
- Floods are the No. 1 natural disaster in the United States.
- From 2008 to 2012, the average flood claim amounted to nearly $42,000.
- From 2003 to 2012, total flood insurance claims averaged nearly $4 billion per year.
- People outside of mapped high-risk flood areas file nearly 25 percent of all National Flood Insurance Program claims and receive one-third of Federal Disaster Assistance for flooding.
- More than 50 people died in flash and river floods according to U.S. Natural Hazard Statistics report in 2009.
- More than 55 percent of the dead were in a vehicle that tried to cross during a flood.
- Flash floods, common in areas like Tuscon, often strike without warning.
- In 1981, a flash flood in Tanque Verde Creek, east of Tucson, killed eight.
What is the National Flood Insurance Program?
In 1968, Congress created the National Flood Insurance Program (NFIP) to help provide a means for property owners to financially protect themselves. The NFIP offers flood insurance to homeowners, renters, and business owners if their community participates in the NFIP. Participating communities agree to adopt and enforce ordinances that meet or exceed Federal Emergency Management Agency requirements to reduce the risk of flooding. Fortunately, most AZ municipalities participate in the NFIP and the insurance protection it provides is available to residents.
Since standard homeowners insurance doesn't cover flooding, it's important to have protection from the floods associated with heavy rains, flash floods, and other rising water conditions that impact Arizona.
Do I Need Flood Insurance?
The NFIP, in conjunction with the Federal Emergency Management Agency, has developed flood plain maps for those areas at the highest risk of rising waters. Several scenarios exist where you may be required to carry flood insurance protection. If you reside within a high-risk area in AZ, or your business is located on such a flood plain, the lender with which you secured the loan to purchase the property may require you to carry flood insurance. If your loan is federally backed, such as an HUD loan or a VA loan, you will be required to get an NFIP policy.
Even if it's not required by your lender or the federal mortgage backer, flood insurance is a good idea to protect your home and assets from flood damage.
What Kind of Flood Insurance is Available?
Most insurance providers who partner with the NFIP will offer you a choice of three common flood insurance policies:
- General property policy: covers five or more family residential buildings and non-residential buildings
- Residential condominium building association policy: covers condominiums and townhomes
- Standard flood insurance policy - dwelling: Covers up to four family residential buildings and single family dwelling units in a condo/townhouse building
For standard dwelling coverage, you have two options:
- Building property coverage - up to $250,000
- Personal property coverage - up to $100,000
The NFIP strongly recommends homeowners purchase both coverage options. You should speak to your lender, as they may have certain requirements for the type of flood insurance you should carry.
What Does Flood Insurance Cover?
Building property and personal property coverage will protect most things in your home, with some exceptions. For example, you will not be reimbursed for damage to most cars and ATVs, or any belongings outside the building. You may want to consider obtaining comprehensive insurance coverage for your vehicles in order to fully protect them from flood damage if you only carry liability or collision coverage.
For the structure of your home, insurance providers will give you two options for coverage:
- Actual cash value: This type of reimbursement takes depreciation into account.
- Replacement cost: This compensation method ignores depreciation and will reimburse you the cost to replace your home with current market values.
With flood insurance, you can only cover the contents of your home at actual cash value.
What Will My Flood Insurance Quote Look Like?
Fortunately, the partnership between Arizona insurance providers and the NFIP holds premiums to certain standards and they cannot vary from one insurance company to another.
A number of factors are considered when determining your flood insurance premium quote, includng:
- The amount and type of coverage being purchased
- Your Arizona location and flood zone
- The design and age of your structure.
For homes in high-risk areas (e.g., Special Flood Hazard Areas or AE, VE Zones) built after the first Flood Insurance Rate Maps were drawn for that community, the elevation of the building in relation to the base flood elevation is also required.
According to the NFIP, the average flood insurance quote is around $600 per year. However, for those located outside a flood hazard area, premium quotes can be as little as $130 per year.
How Can I Find Flood Insurance?
The last thing you want to worry about while you are taking your family to safety during a flash flood is whether your insurance will cover your losses. Independent insurance agents on the Trusted Choice® network are always here to help answer your questions about flood insurance, suggest coverage options, and even assist you in filing a claim.
These agents have years of experience working with Arizona insurance providers and the NFIP, enabling them to find the best coverage at the lowest rates. Flood insurance is complicated, but it's made easy when you work with an experienced agent. Contact a Trusted Choice agent near you to find out how you can secure a flood insurance policy that meets your needs and budget.