Unless you’ve been living under a rock, you are aware that the Federal Emergency Management Agency (FEMA) is the government entity tasked with coming to our rescue after a natural disaster.
When it comes to floods, FEMA surveys land and draft maps based on their studies, designating which areas are high risk flood zones, and which aren’t. These maps are called Flood Insurance Rate Maps, and if your home is in a high-risk flood zone according to these maps, you must carry flood insurance.
That makes perfect sense, right? But what if you pay your premiums every month, yet, when a mega storm hurricane hits your neighborhood, your claim is denied? That was the case of David Clutter, a Long Island resident who had to take a third mortgage on his home after FEMA denied his claim. According to The New York times, Mr. Clutter has been trying to obtain federal assistance for the past five years. Sounds like a nightmare? It is.
Benefits of Private Flood Insurance
While we all can agree that the private insurance industry leaves much to be desired, it does come in handy to have a good policy. And among the benefits of choosing a private carrier over FEMA, is that you can purchase a policy in excess of FEMA’s $250,000 cap. Also, you only have to wait 15 days, as opposed to the 30 days FEMA makes you wait before a policy goes into effect. This is extremely valuable during hurricane season.
In addition to the above, here’s a golden perk: private insurance may also cover your food and lodging expenses while you’re displaced during the time your home is repaired.
Considering that FEMA has been in the red for over a decade now and with the back to back natural disasters 2017’s hurricane season brought along, it behooves you to weigh your options and be realistic about your expectations.