It may seem as though someone, including insurance agents are always working hard to try to sell us something. So, how are you supposed to know when something is going to be worth the cost or not? When that “something” that is being solicited to us is flood insurance, you can absolutely bet that you’re going to want to see that as a “must-have” rather than an upsell. Let's discuss why...
The relevance of flood insurance
So many people on the Gulf Coast (and through the East Coast) MUST prepare themselves for hurricane season. As anyone who’s ever been through one can attest to, hurricanes bring water, and water brings damage. So, it makes perfect sense to have flood insurance anytime that you live anywhere near a body of water!
Weigh the cost of flood insurance
What is the cost? This is a totally understandable question. After all, you’re already shelling out a decent amount of money for home owners insurance premiums; why should you add on more? Well, it’s important to think about it this way.
Let’s just say that your flood insurance costs something like $500 a year. This premium amount is created based on a number of your home’s factors, of course. Keep in mind this is just an example. So, say after 10 years, with no damage, that adds up to $5 000. Sure, that’s a lot of money. But it’s protecting, say, a $200,000 investment (your home) plus all of the belongings that you have in it (say $80,000 of "stuff") which is just under $300K of protection, for that $5,000.
So, that smaller amount over 10 years is going to be WELL beyond worthwhile should you ever need to make a claim. Ask those who have ever gone through a flood and lost everything if they wish they had it. Hindsight is always 20/20, but do the math.
Think about your situation
Remember that policy premiums are based on risk assessment. If you are living in a unlikely area for flooding and you think that your premium is going to be sky high if you ask for it, you are mistaken! A lot of times, the rates are very reasonable when you aren’t right in the path of classic flood risks, so don’t assume that it’s out of your reach! The number above, the example, is clearly more along the lines of someone who doesn't live in a high risk flood area. So, naturally, the more risk, the more the premium, but then again, if you are living in a risk, the chances of it happening are more likely too.
Don’t take the risk
Keep in mind, that even when you live in water-prone areas, flood insurance is not covered under classic homeowner’s insurance! You will never be covered for flooding unless you specifically request to add it to your policy at an additional cost.
Remember that flood insurance takes 30 days to go into effect, so make sure that you add it to your policy before you think you’ll need it. It is going to be entirely worthwhile the moment that you put it to use, should the need ever arise.
At the end of the day, your insurance policies are in place to protect your home and the investment that you’ve put into it. While no one wants to see those premiums inch up at all, flood insurance might be one of those “necessary evils” especially in the Texas Gulf Coast, since it will protect you in situations where repair costs are going to soar easily into the six digits. Isn’t that little extra premium going to be worth your peace of mind, particularly when you are looking at protecting your investment long-term? If you need more advice, call your Harbour Insurance Services independent agent at (281) 520-4090 today!