- Insurance policies take at least 30 days to take effect.
- Landslides and earth movements not covered under flood insurance.
- Flood insurance premiums average $700 per year.
A number of California homeowners have taken the threats of El Niño-fueled storms seriously and recently purchased flood insurance. The National Flood Insurance Program is helping to take some of the pressure off homeowners.
According to the Federal Emergency Management Agency (FEMA), 20,903 National Flood Insurance Program (NFIP) policies were written in the state during November. NFIP is a federal program that offers flood insurance that’s purchased through private property and casualty insurance agents.
For comparison, between August 31 and October 31, 2015, FEMA stated that 7,181 new federal flood insurance policies were written. Together, 28,084 policies were purchased spanning late August to late November.
California homeowners now just considering the purchase of flood insurance may be too late, as policies generally take 30 days to go into effect.
Advising homebuyers to purchase flood insurance
For buyers’ agents, advising clients to purchase flood insurance at the time of a purchase is recommended by FloodSmart, as nearly 25 percent of all flood insurance claims stem from medium- or low-risk flood areas.
Buyers of homes in designated Special Flood Hazard Areas (high risk) are required by law to buy flood insurance as a condition for receiving a federally-backed loan.
NFIP policies provide coverage for buildings and contents, but not for personal property. Additionally, damages from landslides and other earth movements are not covered under flood insurance.
In 2014, the average flood insurance policy premium was roughly $700 per year, according to FloodSmart, which also states that from 2010 to 2014 the average residential flood claim was more than $39,000.
