Here Comes Spring. Got Flood Insurance?

After winter’s record-breaking snow storms, most of the Midwest and parts of the East Coast are bracing for massive melts and widespread flooding. Most standard homeowner’s insurance policies do not include flood insurance or cover damages from flood water.  You need a separate rider or a single-peril flood insurance policy.

The Farmers Almanac predicts that April and May 2010 will be much warmer than usual, meaning when the thaw comes, it will come fast.  But if you don’t put much stock in old fashion weather prediction, consider that the Wall Street Journal is reporting that grain traders added 25 cents to the price of a bushel of soybeans in anticipation of a delayed spring planting season. Making matters worse, many areas of America’s Farm Belt are still recovering from an extremely wet growing season last year. The ground is saturated.  The moral of this cautionary tale:  If you don’t have flood insurance yet, do not wait another day. There is typically a 30-day waiting period from the point of purchase before coverage goes into effect. Wait for April showers and you could find yourself in deep water, literally and financially.

Flood insurance is a relative bargain when you consider that the average flood  claim over the 10 years was $33,000,according to a federal government website. Cost will vary depending on your location’s flood risk assessment and whether you cover the building only or also include its contents. By the way, you don’t have to be a homeowner to purchase flood insurance to protect your personal belongings if you rental unit is flooded. If you have a renter’s policy, consult your agent to see if it already includes flood or water damage, or if you need to buy a rider.

Don’t count on federal disaster assistance to protect you. It’s usually little more than a low-interest loan, available only after an area has been declared a disaster area by the federal government. And the average disaster assistance payment average just $4,000. That’s barely enough to replace your widescreen digital TV set and recliner.

Don’t assume that you’re immune just because you don’t live in a floodplain, either. Floods can happen anywhere, especially in a year like this one. Flood insurance experts estimate that 20 to 25 percent of all flood claims happen in low or moderate risk areas. Be safe, not soggy and sorry. Get flood insurance quotes with your homeowners insurance quotes before the thaw.