Many Still Think Flood Loss Is Covered by Property Insurance

Dated: November 23 2020

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If a lender doesn’t require flood insurance, many homeowners assume they don’t need it. But in S. Fla., Tropical Storm Eta’s visit shows it’s still worth consideration.

FORT LAUDERDALE, Fla. – Tropical Storm Eta’s record rainfall left behind flood-damaged homes across South Florida. And it also left behind a stark reminder that your property insurance policy may not have you covered.

Most standard homeowner or rental insurance covers water damage only if it’s caused by something like a burst pipe, says Logan McFaddin, assistant vice president of state government relations for the American Property Casualty Insurance Association.

“A lot of people don’t know that their homeowner’s or renter’s insurance doesn’t include flooding,” McFaddin said. “It’s usually not included in a normal homeowner’s policy.”

But water damage from a storm? That’s more complicated and customers should carefully review their policies. Even if flood damage is covered, most standard policies will only pay out if the water comes in through damage to your home that was caused by the storm.

Rising water that comes in through doors, windows, floors, walls, backed-up drains or storm surge requires extra coverage on top of your standard policy. Otherwise, you may be left holding the bill.

Many homes were damaged when Tropical Storm Eta made landfall in the Florida Keys and then stalled off the state’s west coast, battering South Florida with drenching rain for days. Parking lots were under water, the Swap Shop was swamped, and many streets and yards were turned into lakes. In all, some parts of the region could approach two feet of rainfall from the effects of Eta.

A typical mistake made by homeowners is passing on flood insurance because their property is not located in an area identified by the government as a flood zone, said Edgardo Isla, chief executive of On The Map Restoration, a South Florida company that specializes in repairing flood-damaged properties.

“Majority of homeowners don’t get flood insurance, unless they are advised they are susceptible to floods,” Isla said. And some mortgage lenders even tell their customers that they don’t need flood insurance.

Homeowners can be confused by complex insurance policies and daunted by their rising costs – leading many to remain without flood coverage, knowingly or not.

But it’s a risky gamble to take, said McFaddin, since any part of South Florida could experience flooding.

“This has been a problem in Florida for a while basically because we are so close to sea level. A lot of parts of Florida are prone to flooding because we are so close to so many bodies of water,” McFaddin said.

When it comes time to call on your insurance company for help, the cost of damage can be devastating without proper coverage: The Federal Emergency Management Agency – FEMA – estimates that one inch of floodwater can cause up to $25,000 in damage.

And when faced with such hefty bills, uncovered homeowners may have trouble finding financial assistance. FEMA sometimes offers grants or loans, but only if the area is declared a disaster and an insurance claim is declined.

FEMA granted Gov. Ron DeSantis’ request for a pre-landfall emergency declaration for Tropical Storm Eta, which means there should be some resources available for Floridians impacted by the storm.

If you were lucky this time, don’t expect to wait for the next storm threat to get flood insurance, experts say. Most policies have a 30-day waiting period before kicking in.

FEMA’s National Flood Insurance Program helps homeowners find coverage directly or through a network of insurance companies. The agency recommends contacting your insurer to review your policy and purchase additional flood coverage if necessary.

If you do have flood insurance and are able to file a claim, experts advise first hiring a remediation company to mitigate the damage, which can lower the size of the claim. They also stress the importance of documenting what your home looks like before and after a storm, as this can be a critical step in the claim process.

“It’s become ingrained that we stock up on water and food during a hurricane,” McFaddin said. “We are trying to get people to take video footage on your phone before and post event as the best way to get a claim started.”

They also recommend having a public adjuster help you with the claims process, as many homeowners may settle a claim at an amount lower than what they might be entitled to.

© 2020 the Sun Sentinel (Fort Lauderdale, Fla.). Distributed by Tribune Content Agency, LLC.

Be sure to read up on your insurance policies. Know your rights. If you're looking to sell, rent and or purchase a property in South Florida, contact Roxanne Dixon at Roxanne has been in the Real Estate industry since 2012. #buyrealestate #sellrealestate #realtorinsouthflorida #realtorinsouthfl #realestateagent 

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Roxanne Dixon

Highly motivated Real Estate Agent with over 8 years of diverse experience in residential(Purchase/Sale), commercial, and investment(Annual Rental, Airbnb, Property Management) estate. Strong analytic....

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