*By John Voket, RISMedia Consumer Confidant
I occasionally like to provide important updates to property and homeowners about flood insurance.
The latest news on this front is the Biggert-Waters Flood Insurance Reform Act of 2012 was signed into law Friday, July 6 by President Obama. The reforms include increasing access to the National Flood Insurance Program (NFIP) for some residents whose homes were impacted by flooding from federal land that resulted from wildfires.
Remember, homeowner’s insurance policies do not cover flooding. And if you’re shopping for a house in a designated Special Flood Hazard Area (deemed at high risk), then federally regulated or insured mortgage lenders must, by law, require you to buy flood insurance as a condition for the loan.
Even if you are not required by law to buy flood insurance, you should consider it based on these facts:
• Floods and flash floods happen in all 50 states.
• Just an inch of water can cause costly damage to your property.
• Flash floods often bring walls of water 10 to 20 feet high.
• Hurricanes, winter storms and snowmelt are common (but often overlooked) causes of flooding.
• New land development can increase flood risk, especially if the construction changes natural runoff paths.
• You are eligible to purchase flood insurance as long as your community participates in the National Flood Insurance Program. Check the floodsmart.gov Community Status Book to see if your community is already an NFIP partner.
• It takes 30 days after purchase for a policy to take effect, so it’s important to buy insurance before the floodwaters start to rise.
• In a high-risk area, your home is more than twice as likely to be damaged by flood than by fire.
• Anyone can be financially vulnerable to floods. People outside of high-risk areas file over 20 percent of NFIP claims and receive one-third of disaster assistance for flooding.
• The average annual U.S. flood losses in the past 10 years (2001-2010) were more than $2.7 billion.
• When your community participates in the Community Rating System (CRS), you can qualify for an insurance premium discount of up to 45 percent.
For everything you need to know about flooding risks and flood insurance, visit www.floodsmart.gov.