Hurricane Season's Biggest Threat Is Not the Storm Itself

Hurricane Season's Biggest Threat Is Not the Storm Itself

Top of the list

Flooding is the nation's top natural hazard according to the National Flood Insurance Program, run by FEMA. Whether due to hurricanes or other storms, flooding has caused damage in all 50 states over the past five years, with damages ranging upwards of $50 billion annually.

Source: Flickr; U.S. Geological Survey

Wide-spread Damage

One of the reasons that flooding tops the threat list, over physical damage from hurricanes or tropical storms, is its ability to spread further than a storm's footprint.

While a storm surge (water pushed inland by strong winds) has a huge, direct impact on coastal areas, the same surge can effect areas much further inland.

Due to rising sea levels, water levels are already elevated, allowing flooding to spread further than in past years.

A different kind of damage

Not only does flooding from a storm effect a larger swath of the population than just coastal areas, but it causes a substantial amount of damage with very little water necessary.

Though a home may only be flooded by a few inches, that water seeps into the pores of the structure, damaging foundations, walls, electrical systems, and many other components of a home.

Source: Flickr; DVIDSHUB

Prepared for the financial stormBetween 2008 and 2012, the average damage claim for a flooded property was $38,000.

And for those that are not prepared, the financial burden may be just as challenging as the physical repairs.

Recent storm troublesFollowing both Hurricane Katrina in 2005 and Sandy in 2012, many property owners found that their insurance policies lacked coverage for flooding.

For those without dedicated flood insurance coverage, assistance for cost of repairs and rebuilding fell to Federal Emergency Management Agency assistance.

Unfortunately, FEMA isn’t always the best resource. Following Hurricane Sandy, 57% of those who applied for FEMA assistance were rejected.

Standard insurance isn’t enough

As many Katrina and Sandy victims found out, typical home-owners insurance policies exclude coverage for flooding, requiring policyholders to supplement their basic coverage.

Likewise, even separate hurricane policies may have similar restrictions and requirements in relation to flooding. For example, if hurricane-force winds destroyed your roof and water flooded your house as a result, you’re covered. If a nearby river overflowed due to the storm’s downpour, you may not be.

Regardless of the limitations of standard home insurance policies, only 18% of Americans have dedicated flood insurance despite the fact that 25% of claims come from low to moderate flood-risk areas.

National Flood Insurance ProgramThe National Flood Insurance Program provides flood insurance for the majority of Americans.

Working in partnership with 90 private insurance companies, NFIP offers up to $350,000 in coverage: $250,000 for physical damage to your home and $100,000 for your possessions.

In 2013, the average annual cost of a flood insurance policy was $637. So, for a little over $50 per month, homeowners can have the added peace of mind that their home is better protected in the event of a flood.

NFIP limitationsThe protection offered by the National Flood Insurance Program’s policies can still leave some homeowners out in the cold.

NFIP policies do not usually cover basements, other than heating and cooling systems located there, so anyone with damage to a finished basement would have additional costs to bear.

Vacation homes are also a tricky area, with higher premiums and policy limitations that could increase your expenses.

The policy will only cover the actual cost of repairs and replacement, so relocation costs like a temporary rental or hotel stay will be out-of-pocket expenses.

And of course, if your home sustains damage above the $250,000 limit, you’ll be responsible for the difference.

Bigger homes, bigger needs

For homeowners with bigger needs, supplemental flood insurance can be purchased from private insurance companies.

There are some specialists that can provide coverage for highly specific insurance needs, like those with homes in coastal areas.

Source: Flickr; Ben Salter

Don’t be left stranded

Flooding is the most commonly occurring natural disaster, leaving millions with huge potential financial expenditures in the wake of this season’s 15 anticipated storms.

With only two major storms making landfall in the Atlantic region, this season’s storm count may fall below historical averages, but homeowners should prepare themselves (and their insurance policies) nonetheless.

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