Flood Insurance

Details

Updated on Tuesday, October 2, 2012, 7:33 pm

Flood insurance protects you from the financial devastation caused by floods. If you don't have flood insurance, talk to your insurance agent. Even a few inches of water can bring thousands of dollars in repair and restoration costs. Most homeowners insurance does not cover flood damage, and disaster relief funds cover only a small portion of flood damage.

Albany participates in the National Flood Insurance Program (NFIP) that makes available federally backed flood insurance for all structures, whether or not they are located within the floodplain. The premiums are discounted because Albany also participates in FEMA's Community Rating System (CRS) program, which requires floodplain management activities above and beyond the minimum NFIP standards. Federal financial assistance requires the purchase of flood insurance for buildings located within Special Flood Hazard Areas (SFHA) - a requirement that affects nearly all mortgages financed through commercial lending institutions. Even if you don't carry a mortgage, you should still have flood insurance. If you rent, your landlord is responsible for the structure but not your belongings. While the mandatory flood insurance purchase requirement has been in effect for many years, not all lending institutions required flood insurance in the past. Today, however, most institutions are now requiring the flood insurance purchase, and some are reviewing all mortgage loans to determine whether flood insurance is required and should have been required in the past. If your property or home is above or outside the floodplain, you may qualify for a Letter of Map Amendment to correct the Flood Insurance Rate Map.

Coverage applies whether flooding results from heavy or prolonged rains, snow melt, blocked storm drainage systems, levee dam failure, or other causes. To be considered a flood, the waters must cover at least two acres or affect at least two properties.

Flood insurance is available for properties within and outside of floodplains. Your property's flood risk is shown on flood hazard maps. Different types of policies are available depending on your flood risk:

• If you live in a high-risk area, you will need a Standard Policy. Most mortgage lenders will require that you have such a policy before they will approve your loan, including refinancing.
• Outside of high-risk areas, flood insurance is also available, usually at lower cost. A Preferred Risk Policy covers both a home and its contents. While you aren't federally required to have flood insurance in a low-to-moderate risk area, it doesn't mean you won't ever need it. Large floods often extend beyond the boundaries of high-risk areas and smaller floods occur outside high-risk areas as well. In fact, about 25% of all flood insurance claims come from low-to-moderate risk areas.

FEMA has the latest information about flood insurance policies and premiums at http://www.floodsmart.gov/floodsmart/. FEMA's "Answers to Questions about the National Flood Insurance Program" is at http://www.fema.gov/library/viewRecord.do?id=1404.