Residents of Virginia are well acquainted with floods. You can protect your assets with flood insurance. A local agent can get you quotes on a policy from the National Flood Insurance Program. Whether you live in Richmond, Hopewell or Lexington, floods can and do happen. Some people think their homeowners insurance will cover any and all damage caused by flooding, only to realize it doesn't when their insurance company denies their claim. Only a comprehensive flood insurance policy, or rider, can fully protect homeowners against flood damage.
According to the National Flood Insurance Program:
The National Flood Insurance Program (NFIP) is a program that was created by Congress in 1968 through the National Flood Insurance Act of 1968. The program allows property owners in participating communities to purchase insurance from the government against losses from flooding. This insurance is designed to provide an alternative to disaster assistance to meet the escalating costs of repairing damage to buildings and their contents caused by floods. As of April 2010, the program insured about 5.5 million homes.
Participation in the NFIP is based on an agreement between local municipalities and the federal government, which states that if a community will adopt and enforce a floodplain management ordinance to reduce future flood risks to new construction in Special Flood Hazard Areas (SFHA), the federal government will make flood insurance available within the community as a financial protection against flood damage. The SFHAs and other risk premium zones applicable to each participating community are depicted on Flood Insurance Rate Maps (FIRMs). The Mitigation Division within the Federal Emergency Management Agency manages the NFIP and oversees the floodplain management and mapping components of the program.
Homes and buildings in high-risk flood areas with mortgages from federally regulated or insured lenders are required to have flood insurance. That's because in high-risk areas there is at least a 1 in 4 chance of flooding during a 30-year mortgage.
Homes and businesses located in moderate-to-low risk areas that have mortgages from federally regulated or insured lenders are typically not required to have flood insurance. However, flood insurance is highly recommended because anyone can be financially vulnerable to floods. People outside of high-risk areas file more than 20 percent of NFIP claims and receive one-third of disaster assistance for flooding. When it's available, disaster assistance is typically a loan you must repay with interest.
It's a good idea to take a look at the SFHA map of your Virginia neighborhood to find out the risks inherent to your area.
Most Virginia insurance companies will give you the following options to choose from as you consider a quote on flood insurance:
For standard dwelling coverage, you have two options:
The NFIP strongly recommends homeowners purchase both coverage options. It's a good idea to speak with your lender, as a mortgage company can also require you to carry a certain amount and type of flood coverage.
These two combined coverage types will cover 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 of the building. You may wish to look into comprehensive or catastrophe insurance quotes for your vehicles, boats or Virginia business, to protect yourself from additional losses due to flood damage.
A flood insurance policy won't ever pay out any more than the exact amount of the policy. For example, if you have $250,000 in flood insurance, it will never pay more than $250,000 for structural damage. You will have the option to buy building property flood insurance at replacement cost value (RCV) or actual cash value (ACV). You can only buy personal property flood insurance at ACV coverage amounts. These two types of reimbursement have significant differences.
Flood insurance is complicated. It's highly recommended that you speak to a professional agent who can help you get the coverage you need and fully understand your options.
The National Flood Insurance Program (NFIP) is administered by the Federal Emergency Management Agency (FEMA), which works closely with nearly 90 private insurance companies to offer flood insurance quotes to property owners and renters. In order to qualify for flood insurance, a community must join the NFIP and agree to enforce sound floodplain management standards. Fortunately, most Virginia cities and counties participate in the NFIP.
One great thing about this partnership between the federal government and insurance companies is that quotes and rates are set and do not differ from company to company or agent to agent. These quotes depend on many factors, which include the date and type of construction of your home, along with your building's level of risk.
A number of factors come into play when determining your flood insurance premium. These factors include:
For homes in high-risk areas (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.
An experienced agent can help you gather the information needed to find you an accurate quote.
An independent Trusted Choice® insurance agent is always close by, to help answer your questions, search for flood insurance quotes, and even help you file a claim. These local agents have ample experience working with the NFIP and can help you navigate uncertain waters. Contact a Trusted Choice agent in your area to find out how you can be better prepared for floods.