A 5.7 earthquake 3 weeks ago, followed by Hurrican Irene rains 2 weeks ago, followed by Tropical storm Lee flooding last week has led to a huge number calls asking if and how they can protect themselves from these disasters in the future. In our prior post, Earthquake Insurance: Something You Must Prepare For, we explained how earthquake damage is generally excluded from your homeowner insurance but coverage can be bought back by adding an endorsement to your homeowner insurance policy. This week, local Realtor Jeff Geoghan from YourLancasterHome.com and I discuss how homeowners can protect themselves against common water damage situations including floods.
Sewer, Drain and Sump Pump Backup Coverage
The Backup of sewer, drain and sump pump coverage provides protection when heavy rains overburden sewer systems and sump pumps causing unwelcomed water to enter the home. Not only does a backup cause thousands of dollars of damage but it also can create a major health hazard if raw sewage is involved.
A recent study by Zogby International shows that 67 percent of homeowners believe water damage from a sewer, drain or sump-pump back up would be covered. However, most homeowner and renter polices do not cover this type of loss without specifically adding it to your policy by endorsement. The good news is that this coverage can be added to most homeowner or renter insurance policies for ~$50-$100 per year and it can give you $2,500 to $50,000 of protection.
Do not assume you have this coverage today and make sure to ask your agent about your specific policy and need for this coverage. If you are shopping homeowner insurance make sure to find out if this coverage is included in your quote. This is great example how buying based on the lowest price and not knowing the details of the policy can leave you with some unexpected surprises at claim time.
Flood Insurance Is Available to Everyone
According to the FloodSmart.gov, your home has a greater chance of being damaged by a flood than by fire. However, your homeowner or renter insurance policy does not cover damage to your home or property for a flood. The only way to have coverage for a flood is to buy flood insurance from an insurance agent.
One common myth about flood insurance is that it is only available to homeowners who live in high risk flood areas with mortgages. Actually, any homeowner, renter or condo owner can buy flood insurance. According to FloodSmart.gov, those in low risk areas are also eligible for flood coverage on their building and contents which can start as low as $129 per year. With the average flood claim for 1 inch of water in a 2000 square foot home costing $21,000, the benefits of having flood insurance can add up quickly for any renter or homeowner. Click here to find out how much a flood may cost for your home.
Flood insurance is not designed to be as comprehensive as a homeowner insurance policy but it is simply designed to get you back on your feet. For example, flood insurance can be very limited for damage to basements, walkout basements and crawl spaces and the property that is stored in them. Most flood insurance also has a 30 day waiting period before the policy takes effect. So it is a good idea to start the process early because you will not be able to get coverage the week prior to the next big Lancaster storm.