There's More to Flood Insurance than Buying a Policy

Sharing news release from FEMA Region 8.

Flooding is the most common natural disaster in the United States. Already there are reports of localized flooding in states across the Rocky Mountain region—and the upcoming snowmelt means there is potential for even more serious flooding.

The Federal Emergency Management Agency (FEMA) manages the National Flood Insurance Program (NFIP) that provides flood insurance policies that provide millions of Americans their first line of defense against flooding. But those flood insurance policies are only one component of the program and just part of the protection NFIP provides to individuals and the American public at large.

For anyone to be able to purchase an NFIP policy, the only requirement is that they live in a participating community. A participating community can be a town or city or a larger jurisdiction like a township or county that includes unincorporated areas. It is up to the community to opt into the NFIP program for the benefit of its citizens. When joining the program, the community agrees to assess flood risks and to establish floodplain management ordinances. In return for taking these actions, residents are able to purchase federally backed flood insurance policies.

One of the cornerstones of the NFIP is the flood mapping program. FEMA works with states and local communities to conduct studies on flood risks and develop maps that show the level of risk for that area, called a Flood Insurance Rate Map (FIRM). The FIRM provides useful information that can assist in communities in planning development. The area that has the highest risk of flooding is the Special Flood Hazard Area (SFHA), commonly called the floodplain. The SFHA has a one percent chance of being flooded in any given year. Because of the greater risk, premiums for flood insurance policies for properties in the SFHA are greater than for those for properties outside of it.

Equally important to knowing the risks of flooding is having a game plan to address those risks. This is role of floodplain management. Local communities must comply with minimum national standards established by FEMA, but are free to develop stricter codes and ordinances should they choose to do so. Key elements of floodplain management include building codes for construction in the floodplain and limitations on development in high risk areas. Floodplain management is an ongoing process, with communities continually reassessing their needs as new data becomes available and the flood risk for areas may change.

The NFIP brings all levels of government together with insurers and private citizens to protect against the threat of flooding. Federally sponsored flood maps and locally developed floodplain regulations give property owners the picture of their risk and ensure building practices are in place to minimize that risk. As a property owner, purchasing a flood insurance policy is a measure you can take to further protect yourself. To find out more about your individual risk contact your local floodplain administrator. For more information on flood insurance policies or to find an agent, visit www.floodsmart.gov or call 1-800-427-2419.

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FEMA's mission is to support our citizens and first responders and to ensure that as a nation we work together to build, sustain, and improve our capability to prepare for, protect against, respond to, recover from, and mitigate all hazards.

For more information regarding flood preparedness and flood insurance, visit the FEMA Region VIII Flood Insurance Media Kit atwww.fema.gov/r8flood.


Media Contact: FEMA News Desk: 303-235-4908

Consumer Alert: Five Insurance Tips for Storm Damage from Colorado DORA

Consumer Alert: Five insurance tips for storm damage

Division of Insurance can help with insurance and claims questions

Many Coloradans woke up Friday morning to the aftermath of severe storms and damage to their homes and property. These events were only the latest reminder of the damage severe storms can bring.

The Colorado Division of Insurance (DOI), part of the Department of Regulatory Agencies (DORA), encourages consumers to “Take 5 to Get Wise” when handling insurance, claims and repairs in the wake of storm damage.

Five Tips for Dealing with Storm Damage and Insurance

1. Start the claim process - Call your insurance company or agent and begin the claim process. Contact DOI if you need the contact information for your company or agent.
2. Document / mitigate the damage - If the damage to your home is extensive, start taking photos of the property and documenting what was lost. If the damage is repairable, mitigate further damage by placing tarps on roofs or boarding up windows.
3. Check contractors - Roofing contractors and other construction contractors will start door-to-door sales or phone solicitations. As with other disasters, consumers need to be on the alert for predatory practices or promises that seem too good to be true. Verify what your city or county requires concerning licensing or registration of contractors - make sure the contractor you work with is authorized to do business in your area. Do your homework, check references and preferably hire a local Colorado contractor.
4. Verify public adjusters - Public adjusters may also begin contacting you if you have suffered damage to your home. You are not required to hire a public adjuster, but if you do, make sure he or she is licensed and reputable – check references. If possible, hire a Colorado-based adjuster. DOI licenses public adjusters and consumers can call the Division to verify a license. Public adjusters work on behalf of a consumer and receive a negotiated commission based on the final payment of the claim. They sign a contract with a consumer to assist in negotiating the consumer’s insurance claim.
5. Contact DOI –While claims need to be filed with the insurance companies, DOI can assist consumers with questions about insurance and the claims process. Call the Division at 303-894-7490 or 1-800-930-3745 (outside of the Denver metro area).

Flood Insurance

With heavy rains and other severe weather more likely in the warmer months, now is the time to consider flood insurance. Many homeowners do not realize that their basic homeowners insurance does not include protection from flood damage. Flood insurance must be purchased as a separate policy.

The Federal Emergency Management Agency (FEMA) administers the National Flood Insurance Program (NFIP), a federally subsidized program available to any property owner – homeowners, renters, condominium owners and associations - whether or not the property is in floodplain. National Flood Insurance is sold through a private insurance agent selling it to a community that has joined NFIP. Contact your insurance agent about buying flood insurance. If you do not have an agent or your agent does not sell flood insurance, contact the NFIP at 1-888-379-9531 or go to www.floodsmart.gov to get the name of an agent in your area.

Typically, there is a 30-day waiting period, after applying and paying the first premium, for the insurance to become effective.

For more information, visit the Colorado Division of Insurance flood insurance webpage or the FEMA / NFIP website www.floodsmart.gov.

Home Inventories

Before any disaster strikes, consumers should recognize the value in creating a home inventory. An inventory helps consumers in determining what’s been lost and in working with their insurance company. DOI has developed a Home Inventory Checklist for download that is a good starting point.

In addition, the National Association of Insurance Commissioners (NAIC) has created a smartphone app to help homeowners and renters develop a Home Inventory Checklist. Find information on the app at www.naic.org, under the “Consumer Resources” tab.

The Colorado Division of Insurance regulates the insurance industry and assists consumers and other stakeholders with insurance issues. Visit www.dora.colorado.gov/insurance for more information or call303-894-7499 / toll free 1-800-930-3745.

DORA is dedicated to preserving the integrity of the marketplace and is committed to promoting a fair and competitive business environment in Colorado. Consumer protection is our mission. Visit www.dora.colorado.gov for more information or call 303-894-7855/toll free 1-800-886-7675.

News Release: DHSEM Partners with Rocky Mountain Insurance Information Association to Remind You to Check Your Insurance Coverage

Call Your Insurance Agent Today to Check Your Insurance Coverage Limits

Contact:  Micki Trost
               Cell Phone:  303-472-4087
               EMAIL:  micki.trost@state.co.us

Denver - Thursday, May 29, 2014 - The Colorado Division of Homeland Security and Emergency Management (DHSEM) is partnering with the Rocky Mountain Insurance Information Association (RMIIA) to remind Colorado homeowners and renters to contact their insurance agents to review their insurance coverage.  Those insured should:

• Check the value of your insurance policy against rising local building costs each year.  You do not want to be caught under-insured after a disaster.
• Check the limits of your insurance coverage.  Will it cover floods, mudslides, landslides or mudflows?  
• Secure coverage for risks in your area today.  Basic homeowners insurance typically excludes "Difference in Conditions" such as flood, landslide, mudflow and earthquakes and may include a 30-day wait period before coverage goes into effect.

The RMIIA has posted information on their website to get you started in learning more about insurance coverage.  The information is posted at  http://www.rmiia.org/catastrophes_and_statistics/Mudslide.asp.  

Landslide, Mudslide & Mudflow

A massive mudslide endangering homes in Mesa County, Colorado... The tragic Washington State mudslide... These events raise questions about what's covered by insurance and what's not. Here's what you need to know:

• Homeowners, renters and business insurance policies typically exclude flood, mudflow, landslide and earthquake. Also visit:Homeowners Insurance Basics

• Landslides, mudslides and mudflow are considered different perils and require different insurance—separate from a homeowners or business policy. Landslides and mudslides are primarily earth movement, while a mudflow is caused by water picking up soil and turning into mud. With a mudflow, the primary ingredient is water, so flood insurance will typically cover parts of this loss. Click here to read about flood insurance and mudflow.

• The National Flood Insurance Program offers "Flood & Mudflow" coverage up to $250,000 for a homeowner and $500,000 for a business. Renters can buy policies for their personal contents. Flood insurance must be purchased 30 days in advance of a flood. Also visit: www.floodsmart.gov

• A "Difference In Conditions" policy includes coverage for flood, landslide, mudflow and earthquake. Depending on risk factors, such as the slope of your property or proximity to a cliff, a homeowner with a $300,000 house can expect to pay $1,000 or more per year for this coverage.

• A "Difference In Conditions" policy can only be purchased through a surplus-lines carrier as a stand-alone policy. Click here for details.

• Separate earthquake policies or endorsements to homeowners insurance policies exclude landslides that are not caused by an earthquake. Click here to read about earthquake and insurance.

• Prepare in advance: Evacuation Plan, Emergency Kit, Insurance Coverage, Home Inventory

• Insurance is tied to the "cause of loss" or what peril caused the damage. So, any coverage you have under your homeowners or business insurance policy does not apply if the peril is excluded—flood, mudslide, mudflow, earthquake. That means additional living expenses "ALE" or business interruption is NOT covered. Flood insurance also does not cover ALE or business interruption. Also visit: Homeowners Insurance Basics.

Increased Cost of Compliance can help with recovery, deter future damages

As Coloradans learned in September 2013, heavy rains along the Front Range can lead to extensive flooding. And, as many people have learned, recovering from floods can be a difficult task.

Now as the weather warms, state and federal officials are keeping a wary eye on snow melt and the potential for spring rains.

As part of their preparations, officials continue to urge flood insurance policyholders to make sure they understand what provisions are in their coverage. One part of the policy that might be especially important is the Increased Cost of Compliance (ICC).

NFIP policyholders who are rebuilding after 2013 flood may be eligible for up to $30,000 in ICC funds to cover the cost of bringing the home or business into compliance with local floodplain ordinances. ICC coverage is included as a part of the Standard Flood Insurance Policy.

To be eligible for ICC coverage, the community floodplain administrator must determine that a building has been “substantially damaged,” or sustained “repetitive damage.”

A building is considered to be substantially damaged when the total cost of repair equals or exceeds 50 percent of its pre-disaster market value.

A building is considered to have sustained repetitive damage when it has been damaged by floods twice over a period of 10 years, and the cost to repair the damage, on average, equals or exceeds 25 percent of its market value at the time of each flood event. This applies only if the participating community has a repetitive loss provision in their floodplain management ordinance, and an insurance claim payment is made for each of the two flood losses. To find out if your community has a repetitive loss provision, contact local officials or your insurance company.

To make an ICC claim, owners may decide to:

• Elevate: Raise a home to or above the flood elevation level adopted by a community;
• Floodproof: Make a building watertight through a combination of adjustments or additions of features to the building that reduces the potential for flood damage;
• Relocate: Move a home out of harm’s way; or
• Demolish: Tear down a flood-damaged building.
• Claims for ICC benefits are filed separately from contents or building loss claims. A claims representative will be assigned to help prepare the ICC claim.

For more information on flood insurance or ICC coverage, visit floodsmart.gov or call 1-888-379-9531. Remember that NFIP policies go into effect 30 days after purchase. The time to buy is now.

NFIP Proof of Loss Claims Due By Nov. 14

National Flood Insurance policyholders whose homes or other structures were damaged by flooding have until November 14, 2013, to file claims for their losses.

A Proof of Loss form includes detailed estimates of the cost to replace or repair damaged property.

Proof of loss substantiates the damage claim and is required before the National Flood Insurance Program (NFIP) can make payment. File damage claims with your NFIP insurance company and work with your adjuster to get the proof of loss forms.

If owners notice additional damage to buildings or property, they can file supplemental claims. To do this, immediately notify the insurance adjuster, document the newly discovered damage, then repeat the documentation and filing process used on the original claim. Owners are urged to keep a copy of this packet.

Policy owners who would like to speak to someone in person regarding their claim are urged to go to their local Disaster Recovery Center where staff members are available to provide assistance. To find the DRC closest to you, go to fema.gov/disaster-recovery-centers

For more information about flood insurance, go to floodsmart.gov

Register with FEMA by phone: 800-621-3362 or online at: DisasterAssistance.gov. Multilingual phone operators are available on the FEMA helpline. Choose Option 2 for Spanish and Option 3 for other languages.

People who have a speech disability or are deaf or hard of hearing may call (TTY) 800-462-7585; users of 711 or Video Relay Service can call 800-621-3362.

Register by Web-enabled device, tablet or smartphone: type m.fema.gov in the browser.

Don't be Afraid to File an NFIP Claim

If you had flood damage, don’t be afraid to file a claim under the National Flood Insurance Program (NFIP). Unlike other property policies that often use prior claims to determine premiums, NFIP premiums do not rise due to the filing of a claim.

Flood insurance premiums under NFIP are not determined the same as homeowners policy premiums. NFIP premiums typically reflect flood risk—if a dwelling is built in a high-risk area, the higher it’s built above what’s called the Base Flood Elevation (BFE), the lower the premium will be --because the potential for flood damage is diminished.

Post Wildfire Flood Insurance

Only flood insurance covers flood damage.  
Most standard homeowner insurance policies do not cover flood damage, yet floods are the most common and costly natural hazard in the nation. Wildfires often exacerbate the flood problem. After a wildfire, vegetation that once absorbed rainfall and reduced runoff may be entirely gone. Even soil, once soaking up the water, becomes charred and resistant to absorption. The post-wildfire conditions contributing to flash flooding may persist for 5-10 years. The FEMA Flood After Fire Fact Sheet provides additional information on risks and protection. 

Post wildfire flash floods can occur within minutes of a rainstorm. Flood water may pick up debris and ash left from the fire forming mudflows. Flooding and mudflows can cause significant damage and bring high out-of-pocket costs to property owners. Without flood insurance, many property owners will cover the cost of repairing or rebuilding on their own. 

Be FloodSmart and reduce your risk.
The National Flood Insurance Program (NFIP) provides a means for property owners to financially protect themselves. The NFIP offers flood insurance to homeowners, renters, and business owners if their community participates in the NFIP. Participating communities agree to adopt and enforce ordinances that meet or exceed FEMA requirements to reduce the risk of flooding. The FEMA Wildfire and Flood Risks tri-fold provides information on flooding, mudflows, and landslides along with insurance considerations. 

Find out more about the NFIP and how it can help you protect yourself. Visit the home page of the NFIP at FloodSmart.gov. 

Floodplain Management and National Flood Insurance Program Contacts: 
Michael Gease, Natural Hazards Specialist, FEMA, (303) 235-4814, michael.gease@fema.dhs.gov  
Jamie Prochno, Community Assistance Program Manager, Colorado Water Conservation Board, (303) 866-3441 x3215, jamie.prochno@state.co.us