Following the superstorm, many homeowners have been inquiring about coverage against flooding.
As the claims following Superstorm Sandy continue to be managed, insurers are finding that they are being contacted by consumers for an entirely different reason, which is to learn more about flood insurance and to add the protection to their homes.
The reality of the risk involved in a potential storm such as Sandy has now become more than clear.
Agents and brokers alike are reporting that flood insurance is one of the top reasons that they are being contacted at the moment. As this isn’t a coverage that is included in the typical homeowners insurance policy, people are discovering that if they should ever face a storm such as the one that struck the East Coast of the country at the end of October, they could be facing costs that are well out of their ability to pay.
This has turned the hurricane into a flood insurance reality check for many homeowners.
Unfortunately, all too many didn’t realize that they did not have coverage against floodwaters even though they had a homeowners policy. This was a hard lesson for many to learn, but it was one that wasn’t lost on many other homeowners who are now seeing Sandy as a warning to them that they are not immune to this type of risk.
The majority of the flood insurance inquiries and applications were from consumers in New York, New Jersey, and Connecticut. These were among the states that were hardest hit by the storm and that saw the damage that the floodwaters caused, firsthand.
Among the luxury homeowners in that state, many faced a process involving two steps when they wanted flood insurance coverage. This is because it started with the basic type of policy, which is largely supplied by the National Flood Insurance Program (NFIP). That coverage is up to $250,000 for the rebuilding of the house, as well as up to $100,000 coverage for the contents of the home that were damaged or destroyed.
Though this amount is adequate for the average homeowner, when it comes to luxury homes, this may fall short. Therefore, a second step is required for their flood insurance. This is called an excess or supplemental cover, and is required to fill in the gap left behind by the basic policy.