Insurable Interest

by: Aaron Whitaker

“You can only get flood insurance if you live in a floodplain, right?” No, but that is what I hear most of the time when I bring up flood insurance in conversation. What people should really ask is, “You can only get flood insurance if you live in a community that participates in the National Flood Insurance Program (NFIP), right?” Yes. See how that just rolls right off the tongue?

Flood Insurance, Portage Insurance, Kalamazoo Insurance, Kalamazoo Flood Map

Flood Zones-

X marks the spot, or our office in this case. Portage, MI participates in the NFIP and therefore all the gray you see before you is flood zone X. You can see West Lake (Zone AE) on the bottom, obviously a flood zone as it is a lake. You can also see the Portage Creek (Zone AE) in the upper left hand corner, also a flood zone, it being a creek.

Flood insurance for those in Zone X is fairly inexpensive. The minimum coverage limits of $20,000 building and $8,000 contents coverage are available for as little at $17 per month in some cases. The coverage for contents is very limited for personal property in a basement, unless that basement is a walkout (then personal property may be covered the same as it would be if it was on the main floor of the home).

The Risk-

Not only does flood insurance provide coverage from heavy rain or other natural sources of water, it also provides coverage from man-made floods, such as someone hitting the fire hydrant on your street and the water ending up in your basement. A broken water main (a problem starting to rear its ugly head now that much of the steel used in old construction of water mains is as brittle as ceramic!) can easily flood your basement, but water from that source would also be covered under a flood policy if the broken main results in flooding on the surface. 

It’s likely that you have heard from a friend that had water in their basement after a bit of heavy rainfall or, even worse, many of you have personally experienced it. Anyone that has gone through the experience knows that water entering from an outside source is excluded from a homeowners HO3 policy. You’d be lucky if it was just your sump pump failing and you had an endorsement to add coverage for backup of sewers and drains.

I’ve had to break the bad news one too many times that because the water came in from outside the home, there is no coverage available to pay for the cleanup or repairs. Cleanup alone can carry a heavy price tag, even more so if it is not correctly mitigated. Can you say “mold”, you’ll never want to again if you find it growing in the drywall down in the basement.

Final Word-

Talk with your agent regarding a flood policy, and don’t get in over your head without coverage. Make sure to read my next article on equipment breakdown and service line coverage, both of which can be excluded from a home owner’s policies in some situations.

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 About the author:
Aaron WhitakerAaron Whitaker joined Whitaker-LaChance in 2014 as a Personal Insurance Customer Service Representative. He brought with him extensive customer service experience from working in a retail professional camera store and computer electronic store for three years in Chicago. Aaron manages all personal insurance placement, marketing, account service and claim management. His expertise is in working with our clients to make sure their insurance program takes care of them through all the changes in life. Aaron is a graduate of Kalamazoo Home School Association and attended Columbia College in Chicago, where he studied Graphic Art Design. He is an avid photographer and enjoys fishing.

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Flood Program Participation Information as of 08/2016

Kalamazoo County Communities Participating in the National Flood Program 

City of Kalamazoo, City of Portage, Township of Charleston, Township of Comstock,

Township of Cooper, Township of Kalamazoo, Township of Richland, Township of Schoolcraft,

Charter Township of Oshtemo, Charter Township of Texas, Village of Augusta,

Village of Vicksburg

Kalamazoo County Communities Not Participating in the National Flood Program

City of Galesburg, City of Parchment, Township of Alamo, Township of Brady, Township of Climax, Township of Pavilion, Township of Prairie Ronde, Township of Schoolcraft, Township of Wakeshma, Village of Climax, Village of RichlandFlood Insurance, Portage Insurance, Kalamazoo Insurance, Kalamazoo Flood Map