Kay Bowker of Lumberton, N.J., thought she was one of the lucky ones. In July 2004, when a freak flood struck hundreds of near by homes and businesses, her house, on higher ground, went untouched. In April 2007, when a local creek overflowed, her home was spared once more.
But as Bowker was organizing flood relief for other local residents, groundwater from saturated soil began seeping into her basement, causing tens of thousands of dollars in damage, which her homeowners policy didn't cover. "We're no where near a flood area," she says, so she never thought to buy flood coverage.
It doesn't take a Katrina-style coastal disaster to bring flood damage your way. Snowmelt repelled by frozen ground can cause flooding. New development can leave less soil surface to absorb water, making formerly safe homes suddenly vulnerable.
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Yet a typical homeowners insurance policy won't cover those perils. You'll need separate flood insurance, which ranges in cost from several hundred to several thousand dollars a year, depending on coverage and risk levels.
In recent disasters involving both wind and flood damage, some insurers have tried to pin the blame on flood waters (not covered by their policies) rather than wind (covered) and used that distinction to deny homeowners' claims.
In an average year, a quarter of all flood losses involve homes in areas deemed low to moderate flood risks by the Federal Emergency Management Agency. In part, that's because many of FEMA's flood maps are not up to date.
"With most insurance, we say if there's any doubt, don't buy it," says Robert Hunter, director of insurance at the Consumer Federation of America. "But in this case it's the opposite."
Here are some frequently asked questions about national flood insurance.
Q: Do I have to buy it?
A: If you're using a federally backed mortgage to buy a home that's judged to be at high flood risk, your lender may require it. Otherwise, it's your call.
Q: How do I determine my home's flood risk?
A: For a preliminary assessment, go to www.floodsmart.gov, click on Your Flood Risk and enter your home's address. The level of risk is determined by your property's location on your community's flood map. You can see the flood map for yourself at your local municipal offices.
Q: How do I buy it and how much should I get?
A: Most insurance agents sell national flood insurance. Generally, they recommend replacement cost coverage for the home and contents; that is, coverage to rebuild the home to its state before the flood and to replace its contents.
Unlike some homeowners insurance, a national flood policy generally won't pay more than the policy limit if rebuilding costs run higher than anticipated.
Usually, coverage starts 30 days from the date of purchase, although a policy needed to secure a home mortgage is effective immediately.
FEMA sells up to $250,000 in coverage for the home and $100,000 for its contents. If you need more coverage (called "excess"), call insurers such as Chubb and Firemen's Fund. They also sell a more comprehensive alternative to basic national flood insurance, though the price may be higher.
For more details, go to www.floodsmart.gov and click Flood Insurance Policies on the left-hand side.