USA: 5 common flood insurance myths

By Raymond J. Piper

The National Flood Insurance Program has worked to protect the life you’ve built for the past 50 years and will continue to do so into the future.  Don’t let rumors and myths drive your decisions. 

Here are the five most common myths about flood insurance.

MYTH: I receive flood insurance through my homeowner's insurance.
FACT: Homeowner insurance policies do not normally cover flood damage. That is why the federal government backs the NFIP. You can purchase Federal flood insurance through an insurance agent or company. The average cost of a flood policy is about $700 per year.

MYTH: Even if my property did flood, it wouldn’t be by much.
FACT: Just five inches of water can cause at over $25,000 worth of damage.

MYTH: Flood insurance is only available for homeowners.
FACT: Flood insurance is available to homeowners, renters, condos and businesses.  The best way to learn more is call your insurance agent or go to floodsmart.gov. 

MYTH: Only those who live in a Special Flood Hazard Area (SFHA) can buy flood insurance.
FACT: If it rains in your community, it can flood in your community.  Anyone can buy flood insurance if you live in the more than 22,000 participating communities. A community voluntarily joins the NFIP by agreeing to adopt the NFIP’s minimum floodplain management criteria into its local ordinance. In exchange, flood insurance and other disaster assistance is made available to the community.  If your community does not participate in the NFIP, you can make a request for it to do so through your mayor, city council or county commissioner’s office.

MYTH: I don’t need flood insurance if I can get disaster assistance from FEMA.
FACT: A flood insurance policy responds to flood events that may not be severe enough to result in a Presidential disaster declaration. Before FEMA’s non-NFIP individual assistance becomes available, the flooding incident must be severe enough declared a federal disaster by the President. Federal disaster declarations are issued in less than 50 percent of flooding events. If a declaration is made, federal disaster assistance typically is in the form of a low-interest disaster loan, which must be repaid. Any grants that may be provided are not enough to cover all losses. For example, in Hurricane Harvey an average Individual Assistance grant from FEMA was $7,000, while the average NFIP claim was over $100,000. 

To get more flood insurance facts, visit floodsmart.gov or call your insurance agent.