Flood Insurance: What's It Worth? 

Release Date: June 23, 2009
Release Number: 1838-040

» More Information on West Virginia Severe Storms, Flooding, Mudslides, and Landslides

SOUTH CHARLESTON, W. Va. -- The recent severe storms in West Virginia have underscored the value of flood insurance. Since homeowner’s insurance policies do not cover flooding, Congress created the National Flood Insurance Program (NFIP) in 1968 to help reduce the financial losses created by flood damage.

The average flood insurance premium costs $540 a year. It takes 30 days after you purchase a policy for it to take effect. The waiting period is waived if the consumer is obtaining, increasing, extending or renewing a loan on the property.

Buying flood insurance makes economic sense. For example, over the last decade West Virginia has experienced nine federally declared flooding disasters when homes had significant damage. Over the 10 year period the average cost for flood insurance was about $5000. If during that time, the homeowner had one flood where floodwaters rose 10 inches inside their home, the cost of repairs could have been as much as $18,000.

Homeowners and business owners may purchase flood insurance if their community is among the more than 20,000 communities in the United States participating in the NFIP. These communities agree to adopt and enforce floodplain management ordinances to reduce future flood damage. Mortgage lenders require home buyers to purchase flood insurance if the home is located in a high risk flood area.

The NFIP, administered by the Federal Emergency Management Agency (FEMA), works closely with nearly 90 private insurance companies to offer flood insurance to property and business owners. Flood insurance is easy to obtain and is sold by most property and casualty insurance agents.

Flood insurance will not erase the heartache of losing your home or suffering major losses, but it does ease the pain of costly financial losses. To find an insurance agent, visit www.floodsmart.gov, or call toll-free 888-379-9531.

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 Modified: Friday, 31-Jul-2009 09:09:00