MYTH: I don’t live in a high-risk area so I don’t need flood insurance.
FACT: Almost all areas can be susceptible to flooding. Nearly 25% of all National Flood Insurance Program claims come from outside high-flood-risk areas. Last year heavy rains caused flooding that damaged over 18,000 home in Warren, Michigan. Only 52 had a flood policy.
MYTH: I don’t need flood insurance because federal disaster assistance will cover my loss.
FACT: Before a community is eligible for federal disaster assistance, it must be declared a federal disaster area. This happens in less than 50% of all flooding events. Most assistance is in the form of a loan, which must be repaid. Although $110 million in federal disaster assistance for flooding was given out in Oakland, Wayne and Macomb (MI) counties last year, it went to 92,000 applicants. That’s less than $1,200 per applicant.
MYTH: If I have a sewer or sump pump endorsement on my policy, I will be covered in the event of a flood.
FACT: Purchasing a sewer or sump pump endorsement should not be viewed as a purchase of flood insurance. Most companies make it clear that if a flood is the cause, directly or indirectly, of the backup or pump failure, they will not be cover the damage.
MYTH: My homeowners policy covers a flood loss.
FACT: The vast majority of homeowners policies do not cover floods. You need a separate flood insurance policy to provide that coverage.
Your home is one of the most valuable possessions, and it’s where you and your family spend your lives. Call us today so we can protect it from the nation’s number one cause of natural disaster.
SOURCE: Auto-Owners Insurance Update, Volume 9, Issue 1 January – March 2015