Water Damage Insurance
For the first time in the United States, several insurance companies offer water damage insurance, but only for a limited proportion of the population – for people with expensive homes, far from the most endangered areas.
Fireman’s Fund and Chubb began offering insurance covering the cost of repairing or replacing the house in the event of flooding as part of the full house insurance to attract more wealthy customers. AIG has been offering a similar policy since 2004.
Sales of water damage insurance policies grew after Hurricanes Katrina, Rita and Wilma, which caused considerable damage to their devastating wind and water streams. The water damage insurance policy provided by the federal government for decades only covers water damages caused by pipes under the house itself. In turn, the total home insurance policy covers only the damage caused by wind and rain.
Until recently, private companies have avoided water damage insurance. If they offered it, it was more a consequence of the pressure of government policy. State insurance provides only $ 250,000 to cover the damage to the house’s flood construction itself, and up to $ 100,000 for the property. Today, some private insurers boldly say they will make a significant profit by offering more expensive policies in less threatened areas.
“The last hurricane period has focused much of the public eye on this issue,” said Mark Schussel of Chubb.
The water damage insurance policy can only be concluded by those who already have full insurance of the house and the property there in the same company. Even then, however, it is much more expensive than state water damage insurance. However, the private policy covers much more damage than the state. Also, private policies usually cover expenses for staying in a hotel and food in case of need to leave the dwelling, and the state – no.
“Companies offering water damage insurance are not among the largest in the US but have focused their attention on the big clients,” said Robert Hunter of the Federation of American Consumers.
He also believes that these companies have a real chance of winning this kind of insurance, due to the fact that other insurers, even the largest, consider the risk too big and the interest too small.
Home insurance is generally very detailed and accurately describes what is insured and what is not. Unfortunately, however, there are limitations that are never included in the main policy. And if we do not look around the policy ourselves and include some additions, then we may regret bitterly when the trouble is over.
Exceptions are: earth mass movement – earthquake, landslides, sinking or shrinkage of earth masses, muddy streams; Flood – irrespective of heavy rain, river flow or just drainage returns; Cases of war or nuclear accidents; The provisions of a statutory body – which may cost the repair several times or lead to a compulsory demolition of the property.
Against a war or a nuclear disaster, no company will insure you, but for the other additions you may want to consider what you need and include them in the policy as an add-on. As an example, we give the two states of California and Florida. If we live in California, it is quite normal to buy an earthquake insurance and if we live in Florida, insurance against hurricanes. Well, both insurances are expensive, but do we have a choice? It is better to pay dear insurance and risk less than to save money for insurance and to risk more – a house costing $ 300.00. Not to mention that after hurricanes Katrina and Rita it was almost impossible to find insurance and most of the big players in the insurance business left the southern states. Only New Orleans has filed more than 3,000 lawsuits against insurance companies like the All State and State Farm, say, not paying enough damages for the damages that will last for ten years.
Let’s now talk about a more general problem – the flood. It can happen in two ways – naturally from torrential rains and when our pumps in the basement refuse to work. To cover both ways, we need two water damage insurance supplements, which make insurance much more expensive, but one of the two is very likely to happen to us. Speaking of torrential rains, the flood is a result of a poorly functioning drainage. None of the two additions cover a true flood when the river flows over and fills the house to the second floor. Then a special federal flood protection program enters into force. It is understandable why insurance companies do not offer protection against such floods, especially in areas with historical characteristics as flood prone. This is why this federal program is being run by a small number of insurance companies that act as agents of the federal government. Such an area is Willinging, where this insurance is mandatory and without it you can not buy a house there. In order to be included in such a program, the town you live in must be included in the program of the federal government.
From this point of view, there are two types of programs – regular and emergency. Regular is the program for settlements already included in the program, the second are for settlements that have applied for inclusion in this program. If you are flooded in another area, no one can help you and you will have to deal with the consequences of the flood. Even this program is not perfect because it gives you good water damage insurance for everything that is above the ground level, but not for the basement. There are only the bigger things covered, like the air conditioner to say, but not the walls, the TVs, the ceilings and the floor, and so on. There is no water damage insurance for them if they are placed in the basement. Basement is considered if all four walls are below ground level. But if one of the walls has an outlet to the yard, then it is not considered a basement and all damage is completely insurable.
Moreover, if only your house is flooded, it is not considered a flood of a general nature. At least two houses have to be flooded by the flooded river or two acres of land are under water to qualify for the federal program. Generally no one is given money for something so natural and inevitable that will happen. We all know it will happen because it has happened over the years, and we will be crazy to give our money for something we know beforehand that we will lose. Still, there is a federal program that will somehow benefit us.