Flooding in Georgia Brings Insurance to Forefront

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Flooding in Atlanta affected Metro Brokers office in Woodstock

Flooding in Atlanta affected Metro Brokers office in Woodstock

The recent torrential rains, resulting in widespread flooding, have caused many Georgia homeowners to re-think the insurance coverage they currently have in place. Areas that have either never flooded (at least no record of flooding) are under water from swollen streams and creeks. We’ve all seen the news reports showing homes with water up to the roof tops in the most severe areas. In other areas, the water flooded basements and crawl spaces, then subsided to leave a huge mess behind.

At Metro Brokers Insurance, we’ve literally been “flooded” with calls from clients filing claims for damages. We’ve also seen a marked increase in the number of calls from people wanting to purchase Flood Insurance.

Flood Insurance, why do I need Flood Insurance?  Doesn’t my Homeowners Insurance policy cover flooding?  The answer is “No”.

Homeowners Policy Coverage

A Homeowners Policy covers certain types of water damage that may occur. These include damage caused from a plumbing system or appliance that fails. Examples would be a busted plumbing pipe, dishwasher overflow, hot water heater burst, blockage in the plumbing system caused by a tree root that grows through a waste line in the yard, causing waste water to back up through showers, commodes, sinks. The key is that these causes of loss are all considered to be “domestic water” from a plumbing system on the property.

For an extra cost, an endorsement referred to as “Back-up of Sewers and Drains” coverage can be purchased, which then extends the coverage to include blockages in the sewer system that occur off your property, such as in the city sewer system. Many times, storm drains will become clogged with debris, causing sewer water to back-up into the tubs, commodes and sinks. The key is, this blockage occurs off your property.

A Homeowners Policy will also cover water damage when an opening is created in the structure, such as when a tree falls onto the roof or the roof is blown off. The ensuing rain that falls and enters the opening, damaging ceilings, floors, walls and personal property, is a covered loss.

However, when the rain hits the ground, begins to pool and then enters the home, this is not a covered loss under the Homeowners policy. As a matter of fact, all Homeowners policies have very specific language in them stating losses caused by Flood, Surface Water, Sinkhole, and Mudslide are not covered by the policy. So, in order to protect your home from these losses, a Flood Policy must be purchased.

Defining a flood

The National Flood Insurance Program defines FLOOD as “a general but temporary condition of partial or complete inundation of two or more acres of normally dry land area, or of two or more properties (of which at least one of which is the insured property) from:

* Overflow of inland or tidal waters.
* Unusual and rapid accumulation or runoff of surface waters from any source.
* Mudflow (Defined as a river of liquid and flowing mud on the surfaces of normally dry land areas, as when earth is carried by a current of water).
* The collapse and subsidence of land along the shore of a lake or similar body of water as a result of erosion or undermining caused by waves or currents of water exceeding anticipated cyclical levels that result in flood, as defined above.”

Many people think just because they don’t live in a “designated flood plain”, they cannot purchase Flood Insurance or they feel they don’t need Flood Insurance. Both assumptions are not true. If we’ve learned anything from the past two days, it’s that just because an area has never flooded in the past does not mean it can’t now or in the future. 

Flood Policies are actually underwritten by the Federal Government and FEMA. They’re obtained through insurance companies that participate in the National Flood Insurance Program by contacting an Insurance Agent that represents those companies. The policy is written by the Federal Government and the contract language is the same for every policy written as well as the cost. The difference in price is determined by the location of the home being insured and its relation to flood zones. The closer a home is to a body of water determined to be in a flood zone, the more the annual cost. As such, a home located in an area far away from a flood zone, the lower the annual cost.

What does a flood policy cover?

A Flood Policy covers damage to the structure, with the exception of the finished portions of a basement. This means the paint, wallpaper, floor covering, etc. are not covered for loss.  In addition, the only contents covered in a basement are clothes washers and dryers, food freezers and portable air conditioning units which are in their functioning location and are operable. So, the furniture, electronics, etc. in a finished basement are not covered for flood damage.

In addition, Personal Property or Contents coverage is not automatically included in a Flood Policy as it is in a Homeowners Policy. It must be purchased as separate coverage within the same policy.

The maximum limit of coverage for the Structure that may be purchased is $250,000 and the maximum limit of coverage for Personal Property is $100,000. Lower coverage limits can be purchased depending on your need.

Educating the public about flood insurance

When Hurricane Katrina hit the coast four years ago, many people in those areas exclaimed they didn’t know they needed Flood Insurance, or didn’t know they could have purchased Flood Insurance. As a result, the Federal Government implemented a huge marketing campaign to get the correct message out to everyone in the United States through public service announcements on television and radio, in addition to other mediums such as billboards. 

For several weeks after the skies cleared, nightly news reports spoke of the devastation in the area and the fact that most of the people did not have Flood Insurance even though they could have had it. The fact is, all insurance seems to be too expensive…until you need it.

A Flood Policy for a home with a basement, coverage up to the maximum of $250,000 for the structure and $100,000 for the personal property could cost as little as $352 per year, or about $30 per month. This could be your life saver.  

I want to hear from you

I’m curious…Do you have Flood Insurance? If not, what would make you consider purchasing it?

If you’re an agent whose listing has been affected by floods in Douglasville, Atlanta, Woodstock, etc., do you know if your client has flood insurance?

If you’ve been affected by flooding, be sure to contact your insurance company as soon as possible to file a claim.

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12 Responses to “Flooding in Georgia Brings Insurance to Forefront”

  1. Arthur Harris Says:

    Great information. Do not wait until disaster strikes to get your Flood coverage.

  2. Jamie Hook Says:

    Great information. I was talking to an agent in the East Cobb office about this yesterday and really did not know the answer. Glad you explained it so well and I think we will see a rise in policies sold!

  3. Deborah Gaither Says:

    Very good information.
    I plan to share this immediately. I was involved in a discussion yesterday about flood insurance, availabilty to homeowners, and the coverage; this article answers most if not all of the questions.

  4. Pat Viohl Says:

    This is such great information and quite frankly, I had NO idea about some of the limitations regarding what flood insurance coverage will and will not cover…. this article could not be more timely. I cut and pasted the pertinent parts of this into a word document to share with my friends and clients, giving Metro credit for having generated it, of course!

  5. Sandra Rodrick Says:

    Hindsight- most people always know what to do AFTER the damage has been done. But, looking to the future, most people have a cavalier attitude about it and tend to be penny-wise and pound foolish. Thank you for explaining in such detail and plain language. It puts inperspective something i felt i should be doing but had been advised against since I’m “not in a flood area”. Your information has changed an idea into a plan of action. It is better to be “insurance poor” and “rich” in time of trouble than to risk everything by not having it. There’s insurance for everything. The perfect scenario is to never have to use your insurance which is why those premiums are feel like such a financial burden. However, that burden is lifted in great relief when you do need to use it! Thank you for giving us all something to think about and act upon. I hope the public knows to go to Metro Brokers- real estate, financial, insurance, title/law when they need the right answers to their questions of importance.

  6. Margaret Kees Says:

    Good information. After reading this I still have a question. A friend had damage to a driveway. One portion of the driveway has a culvert to let water pass through. The culvert was damaged and soil supporting the concret drive has washed away leaving the drive intact without support. There are 100 year flood zones on the two acre property, but there is no indication on the plat of an easement. Houses next door obviously have much larger drainage areas. The subdivision plat may reveal more information on any easements. So what direction does this home owner go – his insurance carrier, the county or FEMA?

    • Glen Curry Says:

      The county would be the best place to start on this one to get a determination regarding the responsibility of the culvert. The driveway will probabaly be the responsibility of the homeowner. It is a unique situation, but start with the county. Did he have a flood policy in force?

      • margaret Kees Says:

        The home owner is friends with a civil engineer who after looking at the damage and at the plat is certain that the county will be held liable because they did not properly maintain the drainage easements which also contain the utilities. This along with another person the owner knows who does contract work for FEMA and me who knew the title examiners who provided information on a previous law suit dealing with a similar situation seems to have provided enough information to to to the county – who currently is not taking responsibility for anything. There is no flood insurance because the mortgage company sent a letter to them a few years ago stateing that they no longer needed it.

  7. Bill Collins Says:

    Is there coverage available for the lot…shrubs, trees, sod, etc.?

  8. J Budd Says:

    Most insurance does not cover foundation settlement problems. We have a Screened in porch and a lower deck where one of the poored Concrete foundations has settled and the gound around it is also settling after the recent rains. Would flood insurance cover this?

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