Monday, March 5, 2012

Flood Awareness Month Proclamation Reminds Us about Coverage Gap

Most Iowans have no coverage for damage from flooding


Long-term weather predictions about the risk of flooding this year have been encouraging. That’s good.  We haven’t heard that kind of prediction in recent years. In fact, Iowa has been in the news a lot over the last few years because of several flood disasters.

It would be tempting to let our guard down about flood preparedness. It would also be foolish. It doesn’t take a major widespread risk of flooding to have a community suffer the impact of a flood. All it takes is a storm or a series of storms over several hours or a few days, with enough surface water accumulating to threaten nearby homes and businesses. When that happens, normal homeowners and business property insurance will not help pay the costs of the losses. The exclusion of flood coverage is a standard feature  in property insurance. The easiest way to address this special, unprotected risk is with a flood insurance policy through the National Flood Insurance Program, available in communities that participate in the program.

Many of the same insurance agents who sell homeowners and renters policies are trained and licensed to sell this type of insurance.  Buying it has to be done as a matter of good planning and not a reaction to an immediate problem because, unlike some insurance coverage, flood insurance is not immediately effective.  If you buy an auto insurance policy and are involved in an auto accident while returning from the agent’s office, the coverage protects you.  Flood insurance doesn’t work like that. Having flood protection in force for spring and summer floods means you need to be making your purchase well ahead of time.

What is a flood?

A flood is an excess of water (or mud) on land that’s normally dry. The National Flood Insurance Program (NFIP) defines flood as a general and temporary condition of partial or complete inundation of two or more acres of normally dry land area or of two or more properties (at least one of which is the policyholder's property) from: overflow of inland or tidal waters; unusual and rapid accumulation or runoff of surface waters from any source; mudflow; or collapse or subsidence of land along the shore of a lake or similar body of water as a result of erosion or undermining caused by waves or currents of water exceeding anticipated cyclical levels.

What is Flood Insurance?

  • Flood insurance is a special policy that is federally backed by the NFIP and available for both homeowners and businesses.
  • You can buy flood insurance for your home or business regardless of whether the property is in or out of a floodplain, as long as the property is located in a participating community. To find out if your community participates, visit
  • You may buy flood insurance covering up to $250,000 of flood damage to your home. A standard flood policy will cover structural damage, including damage to the furnace, water heater, air conditioner, floor surfaces (carpeting and tile) and debris clean-up.
  • For an additional premium, you also may buy flood coverage for up to $100,000 of damage to the contents of your home.
  • Coverage is available for up to $500,000 for non–residential buildings and their contents.

How Much Does Flood Insurance Cost?

According to FEMA, the average homeowners flood insurance premium is a little more than $500 a year.

Premiums for flood insurance will vary depending upon your risk level for a flood loss, the amount of coverage you choose, the type of coverage you need and your deductible.

How Can I Buy Flood Insurance?           

You can purchase flood insurance for your home or business regardless of whether the property is in or out of a floodplain, directly from your property and casualty insurance agent or insurance company, if your community participates in the NFIP. Your insurance agent or insurance company also can confirm whether flood insurance is available to you and what it would cost.

Plan Ahead — There is a 30-Day Waiting Period!

It is very important to plan ahead. A flood insurance policy normally will not go into effect until 30 days after you purchase the policy.

Additional Safety Tips

  • For personal safety, identify what storm shelter is available to you and prepare an evacuation plan.
  • Make sure you have bottled water, a first aid kit, flashlights, a battery–powered radio, non–perishable food items, blankets, clothing, prescription drugs, eyeglasses, personal hygiene supplies and a small amount of cash.
  • If you need to evacuate your home, turn off all utilities and disconnect appliances to reduce the chance of additional damage and electrical shock when utilities are restored.
  • Take proactive steps to protect your property from loss. Be sure there is no loose siding on your home and no damaged or diseased trees growing over your home.
  • Take an inventory of your personal property, such as clothes, jewelry, furniture, computers and audio/video equipment. Photos and videos of your home, as well as sales receipts and the model and serial numbers of items, will make filing a claim simpler. In addition, add insurance information to your inventory information — the name of your company and agent, policy number, and contact information.
  • Move all of your important documents to a safe location. Take them with you when you evacuate or store them in a safe deposit box outside the area.

For more information about flood insurance, visit the NFIP Web site at


The Iowa Insurance Division urges Iowans to consider purchasing protection for this type of risk. Iowa’s Insurance Commissioner Susan Voss says, “A flood can strike just about anytime and anywhere. Once a flood happens, or in the days before it does, it’s too late to prevent financial devastation.  If you are to be protected, you have to plan ahead.”


About the Iowa Insurance Division

The Consumer Advocate for Insurance represents consumer interests within the Iowa Insurance Division. 

The Iowa Insurance Division (IID) has general control, supervision and direction over all insurance and securities business transacted in the state, and enforces Iowa’s insurance and securities laws and regulations. The IID investigates consumer complaints and prosecutes companies, agents and brokers engaging in unfair trade practices. Consumers with insurance or securities-related questions or complaints may contact the IID toll free at 877-955-1212 or visit the Division on the web at