Cost of Flood Texas Flood Insurance & How to Lower Your Costs

  • Flood insurance is not legally required in Texas. 
  • Your mortgage lender may require you to have flood insurance if you live in a high-risk area.
  • Purchase flood insurance well before a natural disaster as there is a 30-day waiting period before your policy kicks in.

Flood insurance is a type of

homeowners insurance

that’s sold separately from your homeowners insurance policy. It’s meant to cover your property whenever flooding happens. “A flood is an excess of water on land that is normally dry, affecting two or more acres of land or two or more properties,” according to the Federal Emergency Management Agency (FEMA). 

Flood insurance isn’t typically required unless the homeowner lives in a high-risk flood area. Nonetheless, FEMA recommends having flood insurance as a standard homeowners insurance policy will not provide any coverage for flood-related damages. 

Do you need flood insurance in Texas?

You’re not legally required to purchase flood insurance in Texas. However, if you have a mortgage, your lender will most likely require it if you live in a high-risk flood zone, according to Nick Schrader, insurance agent at Texas General Insurance. 

Even if you don’t have a mortgage and flood insurance isn’t legally required, it’s still important to have flood insurance, especially if you live in a high-risk flood area. You should also consider flood insurance if you live in a low- to moderate-risk area as well. “Nearly every major city in Texas is vulnerable to Gulf Coast hurricanes or sits in ‘Flash Flood Alley,’ one of the most flash flood-prone areas in the nation,” according to FEMA. Hurricane Harvey flooded more than 200,000 homes in 2017, and many of them were not considered ‘high-risk’ areas. 

A flood of just one inch of water can cost a homeowner $25,000 in losses. Having flood insurance can prepare you for flood-related expenses.

How to get flood insurance in Texas

Coverage related to flood damage requires separate flood coverage from your homeowners insurance policy. That said, purchasing flood insurance is slightly different from purchasing a home insurance policy. There are two ways to purchase flood insurance in Texas. 

1. Enroll through the National Flood Insurance Program

The National Flood Insurance Program (NFIP), managed by the FEMA, sells flood insurance to homeowners, business owners, and renters. 

According to FEMA, coverage limits for a family of one-to-four are $250,000 for dwelling coverage and $100,000 in personal property coverage. Flood insurance through the NFIP will also only cover the actual cash value (ACV) of your dwelling and personal property. The ACV is the cost to replace your items minus depreciation. There are currently no options to upgrade your coverage through the NFIP. 

Flood insurance will only cover losses directly from flooding. So if a sewer backup causes flooding, it won’t be covered by flood insurance. Additionally, flood insurance won’t cover temporary housing and additional living arrangements you need to make while your home is undergoing repairs. 

You can purchase flood insurance by calling your home insurance company or insurance agent. You can also search for a participating provider by using FEMA’s provider locator tool or calling the NFIP at 1-877-336-2627. Keep in mind that there is a 30-day waiting period before your flood policy goes into effect. 

2. Go through a private insurer

Some insurance companies offer flood insurance as a standalone policy or endorsement.

By purchasing flood insurance through a private insurer, you get higher coverage limits and policy flexibility that you might not get with a government-sponsored flood insurance policy. For instance, if your home is more expensive to replace, you might benefit from a policy that offers limits higher than $250,000. Additionally, the waiting period for a policy to start is much shorter with a private insurer — 14 days instead of 30 days.

However, there are some drawbacks to purchasing a policy with a private insurer. This option may not be available in all states, and if your home is in a high-risk area, the insurance provider may deny your application for coverage.

What is the average cost of flood insurance in Texas?

In Texas, the average flood policy is approximately $700 a year, according to the Texas Department of Insurance. But prices vary based on your area’s risk level, the value of your home, and the value of the contents in your home. Homeowners who live in high-risk flood areas pay more than those in low-risk areas, according to Schrader. 

Flood insurance is relatively expensive, costing more than half of the average homeowners insurance policy. However, flood insurance is crucial, especially if your home is in a high-risk region. 

FEMA recommends four ways to lower your flood insurance cost: 

  • Lower your flood risk: The best way to decrease your flood insurance premiums is by taking flood mitigation efforts. Examples of flood mitigation options include elevating your property, installing flood openings, and filing in your basements. To learn more about lowering your risk of flooding, check out FEMA’s homeowners guide to retrofitting. 
  • Choose a higher deductible: Paying a higher deductible will lower premiums. Increasing your deductible could potentially reduce your flood insurance cost by 40%. Of course, this may not be suitable for every policyholder, as you will need to cover more out of pocket to rebuild your home with a higher deductible. 
  • Provide an elevation certificate: An elevation certificate (EC) will determine your home’s flood risk and give you an idea of options to lower your home’s risk. Having an EC is not required, but it may help you lower your insurance bill. 
  • Check for community discounts: You may receive a discount if your community is enrolled in the NFIP community rating system (CRS). The CRS calculates a community’s effort to mitigate the probability of flooding in that area. 

Flooding can happen anywhere, but Texas is especially prone to water-related damages from flooding. The best time to take action is before a flood occurs. “If you are thinking about getting flood insurance, you have to be proactive because most flood insurance policies have a 30-day waiting period which will not be valid for a month after signing a contract,” says Schrader. 

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