Floods are the most common natural disaster in America and are caused by heavy rains, melting snow, inadequate drainage, failed flood control structures, and tropical storms and hurricanes. If you live in a flood plain, your home has more than one in four chance of suffering flood damage during the course of a 30-year mortgage, compared to less than a one in ten chance of fire damage.
The National Flood Insurance Program (NFIP) says one in four flood insurance claims come from low-to-moderate flood risk areas, but most homeowners' insurance policies don't cover flood losses! They urge consumers to purchase a separate flood policy for their own protection.
According to "Weather and Climate Extremes in a Changing Climate", a recent U.S. Climate Change Science Program report, climate change is currently increasing the intensity, duration, frequency, and geographic extent of weather events. Flood insurers expect the share of claims from low- to moderate-risk homes and the overall risk for flooding to increase.
If, however, you choose not to buy flood insurance (and are not required to do so), the NFIP advises to consumers to strive to save $20,000 self-insurance. The NFIP's Cost of Flooding Estimator calculates that one inch of water in a home causes about $8,000 in damages, and a foot of water will cost nearly $19,000.
For more information, visit the NFIP web site at FloodSmart.gov.