Colorado Floods Reveal Homeowners’ Need for Flood Insurance

Flooding in Minot

Residents are still waiting for evacuation after massive Colorado floods swept through the area, claiming the lives of several and leaving many without a place to live. The event brought to light just how unpredictable Mother Nature can be, and unfortunately, also revealed that many residents lack much-needed flood insurance.

Homeowners who live in areas that don’t frequently experience floods often know little about this important coverage, assuming that their own homeowners insurance policy will sufficiently cover the cost of damage to their homes. The tragedy serves as an eye-opener for local residents and individuals around the country who currently don’t have flood coverage for their own homes.

Colorado Floods Leave Residents Homeless

When rainfall hit several Colorado counties last week, no one expected the water to swell as quickly as it did. In a short period of time, roads and homes were swallowed by relentless Colorado floods that left many individuals running for safety.

The rain finally began to subside on Tuesday, but not without leaving a pile of devastation in its path. According to the latest reports, six people have died, two women are missing, 3,000 had been evacuated by air and 600 more are still awaiting evacuation.

The floods also reportedly damaged or destroyed more than 19,000 homes and 30 bridges, along with nearly 1,000 miles of road and more than 400-lane miles of state highway.

In the wake of the devastation, officials say hundreds of people are still unaccounted for.

Why Homeowners Insurance During a Flood Isn’t Sufficient

Reports show that most Colorado residents, like many homeowners around the country, don’t own flood insurance policies that cover the cost to repair or rebuild homes following floods.

One of the biggest reasons individuals don’t carry coverage is because they assume their homeowners policies are sufficient.

Homeowners insurance does indeed cover some natural disasters, including tornadoes and hurricanes (damaged caused by wind, not water), as well break-ins and other tragic events. However, standard homeowners insurance policies do not cover water damage.

In 1968, the National Flood Insurance Program (NFIP) was created under FEMA to protect homeowners who suffer extensive water damage. The creation of this program means water damage liability rests with flood insurance policies.

How to Secure a Flood Insurance Policy

Flood insurance policies are available to all homeowners who seek coverage across the country. By simply contacting private homeowners insurance companies locally, policyholders can find out who offers coverage and how much they would have to pay in their area.

One thing to note is the flood insurance costs don’t fluctuate from insurer to insurer. Since all companies offering flood insurance work with the government, they are all required to charge the same amount for coverage.

FEMA estimates that the national average cost of flood insurance is $650 annually.

Some areas that are deemed high-risk, such as parts of New Orleans, require residents to purchase coverage, but since only 10 to 25 percent of Colorado is considered high risk for flooding, only 22,000 homes and businesses in the state reportedly had flood insurance, leaving many more without the financial protection they need in the wake of this tragedy.

Image: The National Guard