Flood insurance- what you need to know
A few years ago, flood insurance was not available for personal insurance policies, like homeowner policies. It was only available for commercial policies. Due to changing weather patterns and better underwriting technologies by insurance companies, some coverage is now available in a homeowner insurance policy which is good news.
However, blanket coverage for flooding is not available. This is due to the complexity of how the high water entered the dwelling and where it came from. Every insurance company has a certain “appetite” for insuring against water damage as it relates to high water. Even the term “flooding” can be defined differently in policies. Definitions of water damage can range from sewer and drain back up, to overland flooding and high water tables.
Water damage can be devastating as seen from the recent flooding in the Sumas Prairie and elsewhere in the province. Flood protection is generally not available in designated flood plains because the likelihood of a large financial loss due to flooding is something that insurers can’t realistically underwrite without charging huge premiums that people wouldn’t pay for.
The best advice we can offer is for you to know your area’s propensity for overland water and flooding and to select the best insurance to minimize your exposure. Not everyone will choose among the several options available. But this is where we can recommend an option based on your situation. Like any insurance policy, you as the customer make the final decision on coverage. Just like earthquake coverage, although we live in a seismically active area, not everyone feels the need include it in their policy.
As atmospheric rivers become more commonplace, insurance will continue to evolve as will building codes and zoning restrictions.