CHICAGO, Ill. -- If you live in a flood plain, you are highly vulnerable to flood damage and to experiencing more than one flood. But even if you don't live in a flood plain, you still have a flooding risk, such as when more rain falls than the ground can absorb. Both conditions caused severe flooding in Illinois several times in 2008.
Many homeowners are in for a painful shock when they find out their homeowners' policies do not give them any financial protection for losses due to flooding. They must carry out of their own budget all or most of the considerable costs for repairing the damage. It can take years to pay off a loan taken out to pay for flood damage. For homeowners who purchase flood insurance, however, there is much less financial stress, since the insurance payout covers their repair and reconstruction costs.
Congress created the National Flood Insurance Program (NFIP) in 1968 to assure that Americans can buy flood insurance and to reduce future flood damage through floodplain management. NFIP provides flood insurance through private insurance agents and insurance companies for homeowners and businesses in communities that participate in the NFIP program.
You can locate an agent who sells flood insurance in your area, assess your property's flood risk or learn more about flood insurance, on the NFIP Web site, www.FloodSmart.gov.
"Of course, buying flood insurance involves paying premiums, but those premiums will almost always be small relative to the costs of repairs and reconstruction after flooding," said Libby Turner, the Federal Emergency Management Agency (FEMA) federal coordinating officer in charge of response to the flooding disaster.
FEMA does provide grants to help pay uninsured costs for repairs and reconstruction after flooding, but there are several reasons homeowners should not rely on FEMA grants as the solution to flood damage. Unlike insurance payouts, FEMA grants are not intended to make a homeowner whole after flooding and will typically not cover the complete cost of all repairs. FEMA grants are only available after a federal disaster declaration. Most flooding does not lead to a disaster declaration. Flood insurance pays whenever there is covered damage.
"The flooding Illinois has experienced this year caused losses to tens of thousands of residents," Turner said. "It's a reminder for all of the damage floods can do-and the benefits of being properly insured
FEMA coordinates the federal government's role in preparing for, preventing, mitigating the effects of, responding to, and recovering from all domestic disasters, whether natural or man-made, including acts of terror.