"Underwater" Real Estate

By Mark Phoenix posted July 7, 2020

Each hurricane season naturally brings renewed interest in avoiding flooding problems.  The Capital Region is no stranger to flood prone areas.  The summer months can be known for hot temperatures, no rain for a period of time or, torrential rain.

No matter where you live, you live in an area with some degree of flood risk.  The question to ask and answer:  Is the risk high, low, or moderate?  You might think that your home is not located in a low-lying area or near a body of water, therefore, your home is not likely to flood.  You should consider a heavy rain that backs up through a rainwater drainage pipe.  If you have experienced a flooded basement, you know how much damage water can do and how fast the damage can occur.  Simply stated “Where it can rain, it can flood”.  Just one inch of water can cause an average of $25,000 in damage.  

You may not realize that most homeowner’s insurance policies do not cover flooding.  A separate flood insurance policy is needed.

If you apply for flood insurance, you can experience a 30 day waiting period between purchasing the policy from the date the policy is effective.  There are two exceptions to this “waiting period” rule.  The first exception would be if a person purchased their flood insurance in concert with closing on a loan, there is no waiting period.  The second exception is to the “waiting period” rule is when a home seller is transferring their flood insurance policy to the home buyer.  In that incidence, there is no interruption of coverage. 

You may not realize that more than 40% of all flood insurance claims are found outside flood prone areas.  Flooding can be the result of torrential rainstorms, snow melt, the effects of hurricanes, water back-up, broken water mains, among several other things. 

The Federal Emergency Management Agency (FEMA) has a website at https://www.floodsmart.gov that has a tremendous amount of information to read on topics such as what flood insurance covers, how much flood insurance costs, where to buy flood insurance, what to do before and after a flood occurs and, a page in which you can input your address to determine if your home is located within a flood prone area.