Kansas City, MO -- This year thousands of homeowners, renters and business owners will be faced with devastating financial loss due to flooding. Many will be surprised to learn after the fact that protection against flood loss is not part of their normal insurance protection package.
Standard insurance policies do not compensate for flood damage.
To clear up some of the misconceptions about flood insurance, state and federal officials have compiled the following list of common myths about the National Flood Insurance Program (NFIP), and the real facts about the program.
MYTH: You can't buy flood insurance if you are located in a high-flood-risk area.
FACT: You can buy national flood insurance coverage for buildings and contents no matter where you live if your community participates in the NFIP. The program was created to provide affordable flood insurance to people who live in areas with the greatest risk of flooding.
MYTH: Only residents of high-risk flood zones can buy flood insurance.
FACT: Even if you live in an area that is not flood prone, it's advisable to have flood insurance. Between 25 percent and 30 percent of the NFIP's claims come from outside high-flood-risk areas. The NFIP's Preferred Risk Policy is designed for residential properties located in low-to-moderate-flood risk zones. Lower rates are also available for businesses in lower risk areas.
MYTH: Federal disaster assistance will pay for flood damage.
FACT: A community may be flooded, but may not qualify for federal disaster assistance because of insufficient damage. Statistically, federal disaster declarations are issued in less than 50 percent of flooding incidents. The most typical form of disaster assistance is a loan that must be repaid with interest. An NFIP policy will pay for flood damage whether or not there is a federal disaster declaration.
MYTH: You can't buy flood insurance immediately before or during a flood.
FACT: You can purchase flood coverage at any time, but there is a 30-day waiting period after you have applied and paid the premium before the policy becomes effective.
MYTH: Homeowner's insurance policies cover flooding.
FACT: Unfortunately, many homeowners do not find out until it is too late that their homeowner's policies do not cover flooding. Only national flood insurance protects your home and belongings in a flood event.
MYTH: Flood insurance is only available for homeowners.
FACT: Renters can qualify too. Flood insurance is available to protect homes, condominiums, apartments and non-residential buildings including commercial structures. A maximum of $250,000 of building coverage is available for single-family residential buildings; $250,000 per unit for multi-family residences. The limit for contents coverage on all residential buildings is $100,000, which is also available to renters. Commercial structures can be insured to a limit of $500,000 for the building and $500,000 for the contents.
MYTH: You can't buy flood insurance if your property has been flooded.
FACT: It doesn't matter how many times your home, apartment or business has flooded. You are still eligible to purchase flood insurance, as long as your community is participating in the NFIP.
MYTH: National flood insurance can only be purchased through the NFIP directly.
FACT: NFIP flood insurance is sold through private insurance co...