Ohio Committee for Severe Weather Awareness Floods & Flood Insurance Information

Flood Insurance / Disaster Recovery and Rebuilding

Flooding can occur during any season. The National Flood Insurance Program (NFIP) estimates that 90 percent of all natural disasters involve flooding. A home has a four times greater risk of flooding than burning, during the course of a 30-year mortgage.

Get the Information and Facts on Flood Insurance

NOTE: On December 31, 2011, President Obama signed the Fiscal Year 2012 omnibus appropriations bill that includes a provision temporarily extending the National Flood Insurance Program through May 31, 2012.

If you are interested in obtaining flood insurance, visit FloodSmart.gov. At this site, you will be able to find a local agent, learn additional flood facts, assess your flood risk, and file a claim.

Flood Insurance Facts

• Losses caused by flooding are not covered by homeowners or renters insurance. Coverage is available through a separate flood insurance policy, the National Flood Insurance Program (NFIP). The program is administered by the Department of Homeland Security's Federal Emergency Management Agency (FEMA).
• Flood coverage is available for any building located in a community that has qualified for the NFIP. Buildings do not have to be located in a floodplain to be eligible for flood insurance.
• Most Ohio communities qualify for the NFIP. According to FEMA, approximately 280,000 structures are located in Ohio's mapped floodplain areas with a value of $11 billion. About 10 percent of these structures are protected by flood insurance. Click here to view a list of Ohio communities participating in the National Flood Insurance Program.
• As of January 2013, the average flood insurance premium in Ohio is $812 annually, compared to $620, nationally..
• Licensed property/casualty insurance agents or brokers can sell flood insurance. The NFIP's toll-free agent referral program number is 1-800-427-4661, for those having difficulty finding flood coverage.
• Flood damage to vehicles is covered by auto insurance when comprehensive coverage is purchased.

About the Policy

• There is a 30-day waiting period before a new or modified flood insurance policy goes into effect, unless it is a condition for obtaining a mortgage.
• The standard flood insurance policy covers direct losses caused by a flood, less an insurance deductible (usually $500 or $1,000).
• Flood insurance protects against damages caused by surface flooding, with limited coverage in basements. It does not usually cover damages from sewer backup or sump pump failure. There may be certain conditions when coverage would apply.
• Two types of coverage are available: Structure Coverage for walls, floors, insulation and furnace, and for specified items permanently attached to the insured structure and Contents Coverage for items contained within an insured structure.
• Homes can be insured up to $250,000; furnishings and contents coverage is available up to $100,000. Commercial (business) coverage is available up to $500,000.
• To file a flood insurance claim, contact the insurance agent or company who sold you the policy.

Preferred Risk Policy Eligibility Extension

On January 1, 2011, FEMA introduced a new flood insurance provision the National Flood Insurance Program (NFIP) to help reduce the financial burden placed on property owners whose buildings were newly mapped into a high-risk flood area.

The NFIP’s Preferred Risk Policy (PRP) offers low-cost flood insurance to owners and tenants of eligible residential and non-residential buildings located in moderate- to low-risk areas.

A PRP offers considerable premium savings to low-risk property owners with no difference in coverage. Under the low cost PRP, there are two types of coverage combinations: building and contents together, and contents only.

In August 2012, FEMA announced the extension of the Preferred Risk Policy eligibility under the National Flood Insurance Program, which permits customers holding existing preferred risk policies to continue to renew their insurance at the lower cost rate..

Beginning with the first renewal effective on or after January 1, 2013, existing preferred risk policies will not be transitions into full-risk rating. Instead, they will continue to be issued as preferred risk policies at each renewal, until further notice.

Additionally, the preferred risk policy discounted rate will be available to property owners and renters whose buildings are found to be in the Special Flood Hazard Area following map revisions effective on or after October 1, 2008.

In order to be eligible for the preferred risk policy, the building must also meet certain loss-history requirements. If there are two claims, or disaster relief payments for flooding of $1,000 or more, or three losses of any amount, the structure is ineligible for a preferred risk policy.

Premiums for all preferred risk policy holders are being increased an average of 13% to maintain a revenue neutral program that also accounts for the expected increase in participation and policies issued under the preferred risk rate. This increased rate remains below the average full-risk premium that would otherwise be incurred among these policy holders.

Effective January 1, 2011, properties that have been newly mapped into a high-risk flood zone, on or after October 1, 2008, may qualify for a Preferred Risk Policy through the PRP Eligibility Extension program.

To view flood insurance policy rates, click here.

For additional information, contact an insurance agent. Previous and current flood zone documentation for your property will be needed to validate your Preferred Risk Policy extension eligibility.

Click here for county floodplain map update information.

You can also obtain historic maps and current effective maps through FEMA’s Map Service website: www.msc.fema.gov.

PRP Resources:
Preferred Risk Policy fact sheet (pdf file)
NFIP Grandfather Rules (pdf file)

Disaster Assistance Available

Most forms of federal disaster assistance are available to individuals and businesses only if the president declares a federal disaster for a specified area or areas. Through the Federal Emergency Management Agency (FEMA), the Individuals and Households Program (IHP) provides money and services to people in the disaster area when losses are not covered by insurance and property has been damaged or destroyed. IHP is designed to help people with critical expenses that cannot be covered in other ways.

The following lists assistance available through IHP: Housing Assistance (which includes temporary housing, repair, replacement and semi-permanent or permanent housing construction) and Other Needs Assistance (which includes personal property, transportation, medical, dental and funeral expenses).

IHP is not intended to restore damaged property to its condition before the disaster. IHP may only provide enough money, up to the program limits, to return an item to service. A resident may be required to purchase flood insurance if a dwelling is in a Special Flood Hazard Area.

While some money is available through Individuals and Households Program, most disaster aid from the federal government is in the form of loans from the Small Business Administration (SBA) Disaster Loan Program, which must be repaid. SBA provides low-interest disaster loans to homeowners, renters, businesses of all sizes, and to private, nonprofit organizations.

The State of Ohio Individual Assistance Grant Program (State IA Program) may also be available to flood victims for losses and expenses incurred by individuals and families who do not qualify for the SBA loan program.

Insurance Tips during Rebuilding

Take the following steps to ensure an effective repair:

• If you feel the settlement offered by your insurer is not fair or complete, contact the company and be ready to provide information to support your claim.
• Protect yourself from shoddy workmanship by using licensed, reputable contractors. Be sure they secure the proper building permits. Beware of contractors requiring a large payment up front or whose bids are amazingly low.
• If your home was destroyed beyond repair and you decide to rebuild on another lot or purchase another home instead of rebuilding, check your insurance policy and discuss this with your insurance agent or company representative. There may be limitations on what your insurer will pay for if you do not rebuild on the same property.
• If you choose to build or rebuild, check with your community’s floodplain administrator to learn about your community’s flood safety standards. These standards are required for all new floodplain development or substantially damaged/improved structures in the floodplain and can help avoid having your home and property damaged or destroyed by flood again. In addition, flood insurance premiums are much lower for structures built in compliance with your local flood damage prevention regulations.
• Remember, your settlement will not necessarily be the same as your neighbors’. Your coverage may be different, as well as the level of damage caused by the storm.
• Your insurance policy provides coverage to repair or replace property you had prior to the storm. It will not pay for improvements.
• If you know your home is not up to local building code standards, you may be required to rebuild the damaged sections according to current codes. In some cases, this may mean a design or building material change that may cost more. Generally, a standard homeowner’s insurance policy does not cover such additional expenses. You may want to consider a policy endorsement that pays a specified amount toward such required improvements.

Consider using this checklist before you arrange
for disaster repairs to your home:

•  Obtain more than one estimate. Do not be bullied into signing the first contract that is presented to you.
•  Obtain all information contained in the bid: costs, work to be completed, repair time, payment schedules, contractor guarantees. Ensure all details are provided.
•  Ask for references and be sure to check them out.
•  Never sign a contract that is incomplete or blank.
•  Do not pay for the repairs or sign a certification of completion until all work has been completed in accordance with the contract specifications.
•  Disaster repairs often heighten the opportunity for insurance fraud and abuse. Do not be tempted to conspire in a fraudulent insurance claim. Insurance fraud is a felony.
•  Be aware that insurance coverage may be void if policyholder misrepresentation is discovered.

Limitations of the Flood Insurance Policy

• If your home or business is damaged by a flood, you may be required to meet certain building requirements in your community to reduce future flood damage before you repair or rebuild. To assist you in covering the cost of meeting those requirements, the Increased Cost of Compliance (ICC) endorsement has been added to the standard flood insurance policy.
• If you own structures determined by the community to be substantially damaged or repetitively damaged by a flood, you may file an ICC claim. Up to $30,000 may be available to help bring your home or business into compliance with the local floodplain code.

Don't Be Victimized Twice - Avoid Disaster Fraud

After a disaster, you are often confronted with making difficult repair decisions in a short period of time. It is important that you educate yourself to avoid dishonest contractors during these hectic times.

Victims of any recent storm or flooding should be extremely cautious and not let the sense of urgency to repair lead them into making a regrettable decision.

Before hiring contractors, check their references and clear them through a local Better Business Bureau or the Ohio Attorney General’s Consumer Protection Section. For a list of bureaus in Ohio, click here.

For additional information, click on the following links:

• Ohio Department of Insurance Consumer Affairs
• Ohio Insurance Institute - Contractor Hiring Tips
• Insurance Information Institute’s home inventory software
• Federal Trade Commission - Protecting America’s Consumers