A Majority Of Homeowners Don’t Have Flood Insurance
Despite the fact that the government subsidizes flood insurance and that it is much cheaper than if it were offered by the private market, many Americans have yet to take advantage of the relatively low cost insurance. A survey conducted by the Insurance Information Institute states that only a small percentage of homeowners have purchased flood insurance.
Record widespread flooding across the Midwest has once again highlighted the catastrophic damages that flooding can cause. Yet a survey conducted for the Insurance Information Institute (I.I.I.) reveals that only 17 percent of Americans have a flood insurance policy.
The proportion of Americans with a flood insurance policy is relatively unchanged from a year ago when 14 percent said they have flood insurance.
The Federal Emergency Management Agency, which runs the National Flood Insurance Program, made a concerted effort to inform homeowner’s of the dangers of flooding prior to the beginning of the hurricane season but met with little success. As the Midwest flooding shows, one does not have to live along the coast to be susceptible to flooding.
One would think that after Hurricane Katrina, residents living in hurricane prone areas would be more likely to purchase flood insurance but that has not been the case. If you want to put your fortunes into the fickle hands of a jury over the wind vs. water debate just be warned that insurers are quickly taking that out of the equation by cutting back on wind damage coverage.
Unless you pretty much live in the desert, flood insurance is definitely something every homeowner should look into. Just because home values have been in decline in the past year doesn’t mean that cost of rebuilding is getting any cheaper, with inflation heating up it’s quite the opposite.
