Gambling With Flood Insurance Is A Poor Bet For Iowans

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Release date: 
July 22, 2009
Release Number: 
1763-243

Des Moines, Iowa -- Every year, thousands of Iowa residents gamble that they won't need to purchase flood insurance. Many of them are going to lose the bet, according to state and federal recovery officials overseeing recovery operations that follow federally declared disasters.

"If more people knew the real risks and were aware of the real odds we'd have a lot more people signing up for flood insurance," said Federal Coordinating Officer Michael Parker. He said that it was a major goal of the National Flood Insurance Program (NFIP) to simplify legal language and reams of statistics so that the clear benefits of purchasing flood protection coverage could be seen.

During the life of a 30-year mortgage in the special flood hazard area, your home has a 26 percent chance of being damaged by flood. During that 30-year mortgage, your home has a nine percent chance of being damaged by fire. This means a home in the mapped flood hazard area has a 17 percent greater risk of flooding than fire.

"It is up to us to communicate the benefits of flood insurance so that people can clearly see why it's a good buy," said Parker.

"The best indicator of success is good word-of-mouth and neighbors are telling neighbors that flood insurance is worth it." 

He noted that 25 to 30 percent of all flood loss claims occur outside the 100-year floodplain and insurance for structures located outside the floodplain can be very inexpensive.

The Preferred Risk Policy is available for most homeowners with a one- to four-family residential building located outside of a high-risk flood area and can cost as little as $119 a year.

Homeowners and renters can buy NFIP flood insurance through most major private insurance companies and licensed property insurance agents who sell homeowners' or property insurance or call the NFIP's toll-free information line at 800-427-4661 or for individuals with hearing or speech impairments (TTY/TDD) 800-427-5593.

FEMA’s mission is to support our citizens and first responders to ensure that as a nation we work together to build, sustain, and improve our capability to prepare for, protect against, respond to, recover from, and mitigate all hazards.

Last Updated: 
July 16, 2012 - 18:46
State/Tribal Government or Region: 
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