When it comes to devastating weather events, it’s incredibly common for Texas to experience flooding from hurricanes and major storms that hit the state. Every year Texas is hit by storms, which can cause extensive flood damage to Texans’ homes and property and lead to large financial losses. While homeowners insurance doesn’t cover flood damage, the good news is that Texas homeowners can choose to purchase a separate flood insurance policy to protect themselves from flooding caused by these types of common hazards.
why do texas homeowners need flood insurance?
Over the last decade, texas has seen some of the worst hurricanes in recent history. In 2017, Hurricane Harvey caused an estimated $125 billion in damage as it hit the Gulf Coast. The storm dropped 50 inches of rain in places and completely flooded one-third of Houston’s land area.
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some research has found that climate change is making flooding in texas more frequent and more devastating. The Washington Post reports that two individual studies found that climate change increased the amount of rainfall after Hurricane Harvey by 20-35%.
data from the federal emergency management agency (fema) show that the risk of flooding is greater along the texas coast, in the southern region and in the dallas area. However, nearly every part of Texas is somewhat susceptible to flooding, which means homeowners across the state should consider flood insurance. Knowing your flood risk could help you decide if flood insurance is right for you.
cost of flood insurance in texas
According to FEMA, the average flood insurance policy costs $700 per year, which provides policies through the National Flood Insurance Program (NFIP). however, her premium will depend on the risk of flooding in her area. Higher-risk areas have a higher risk of flood damage, and residents of those areas tend to pay for higher coverage. Additionally, some private insurance companies offer flood insurance. A flood policy from a private insurer will likely cost a different amount than a policy underwritten by the government. And flood insurance isn’t just for homeowners; renters may want to consider flood insurance to get coverage for their personal belongings.
Not all homeowners pay the same amount for their flood insurance. A variety of factors can affect your premium, such as the specific location of your home, the value of your home, and the value of your belongings within the home, should you choose to insure them (you can purchase a flood policy with only home coverage ). Depending on the state, a homeowner’s credit score and claims history can also affect their flood insurance rate. Not all states allow insurance companies to use your credit-based insurance score when calculating your rate.
when to buy flood insurance
If you’re thinking about getting flood insurance, the key is to be proactive. Most flood insurance policies have a 30-day waiting period, which means the coverage isn’t good for a month after signing the contract, although there are some exceptions. Additionally, some insurance companies suspend the purchase of flood insurance policies when a natural disaster is imminent. if you wait until a storm is on its way to buy insurance, you may not be able to buy a policy.
Insurance experts generally advise that Texans not wait until a storm is brewing to purchase flood insurance coverage. storms are unpredictable and can strike at any time. Having a flood policy in place before a storm approaches is the surest way to prepare for the financial impact of flood damage.
how to buy flood insurance in texas
Buying flood insurance is a little different than buying regular home insurance. The first thing to do when considering flood insurance is determine where you can get quotes. There are two main options for getting flood insurance in Texas.
nfip flood insurance
The most common option is to purchase a policy through the National Flood Insurance Program (NFIP). The NFIP is a government-run insurance program that offers flood insurance. nfip flood insurance can be purchased with homeowners coverage up to $250,000 and personal property coverage up to $100,000.
however, nfip insurance does not cover everything. it does not cover any property other than the main home, so it does not cover a garden, swimming pool, or fence destroyed by flood water. it also does not cover valuables or financial losses from home businesses.
With NFIP insurance, the insured is reimbursed for losses based on actual cash value (ACV). that means depreciation is factored into the payment of the claim. depreciation will be determined by the age and condition of your home at the time of loss.
To purchase NFIP flood insurance, find a participating provider in Texas. Contact the company and ask about flood coverage, and an agent will walk you through the process and explain what is and isn’t covered. once the premium is paid (most flood policies must be paid in full up front), coverage will take effect after the 30-day waiting period.
private flood insurance
The other option is to purchase private flood insurance from a standard insurance provider. Depending on the insurance company, flood insurance is available as a stand-alone policy or sometimes as an endorsement on a homeowner’s insurance policy.
Private insurers may offer higher coverage limits than the NFIP and there may be more flexibility with policy features. In addition, private flood insurance can offer replacement cost value (RCV) for your home and personal belongings, meaning any damage is paid at replacement value.
Before you decide on private flood insurance, research what is required to qualify for coverage. for example, homes located in very high-risk areas may not be eligible for private insurance. in that case, nfip insurance could be a good option.
To get private flood insurance, look for providers that offer this type of coverage in the area where you live. Keep in mind that many private insurance companies sell NFIP policies. Just because an insurance company sells flood insurance does not mean it is “private” insurance. to be considered a private policy, the insurer must underwrite the coverage itself.
frequently asked questions
how much does flood insurance cost?
is flood insurance required?
Does flood insurance include coverage for loss of use?