Flood insurance is one of those things that most people never have to worry about until they actually need it. And when you do need it, you quickly realize just how expensive it can be.
Why is flood insurance so expensive? Is there any way to get around paying these high rates? In this article, we will explore the flood insurance cost per month and try to answer some of these questions.
What Is Flood Insurance?
Flood insurance is a type of property insurance that provides coverage for damage to your property caused by flooding. This includes both the water and the mud that often comes with it.
Is Flooding A Serious Issue In The US?
Flooding is a serious issue in the U.S., especially if you live near a river or lake that has experienced flooding before. According to the Federal Emergency Management Agency (FEMA), 20 percent of flood insurance claims are paid out to homes more than 100 feet from rivers, lakes, and streams.
And even if your home is not located close to water, it can still be affected by floods due to heavy rains or melting snow.
Why Is Flood Insurance So Expensive?
There are several reasons why flood insurance can be expensive. One reason is that it is not a common occurrence, so there is less demand for this type of policy. As a result, insurers are able to charge higher rates.
Another reason is that flood insurance covers a lot of ground. Not only does it cover the damage to your property, but it can also help reimburse you for any additional living expenses if you have to evacuate because of a flood.
This broad coverage means that insurers are taking on more risk when they offer flood insurance policies. And as we all know, the more risk an insurer takes on, the higher the premiums will be.
Can I Get Around Paying These High Rates?
Unfortunately, there is not much you can do to get around paying these high rates. The best thing you can do is shop around for a policy that offers the best coverage at a rate you can afford.
In some cases, you may be able to find a government-backed flood insurance policy that has lower rates than those offered by private insurers. However, these policies often have less comprehensive coverage.
Is Flood Insurance Required?
In most cases, flood insurance is not required. However, there are a few exceptions.
If you live in a high-risk area for flooding, your lender may require you to have flood insurance. This is because if there is a flood and your property is damaged, the lender may not be able to recoup its losses from the government.
Additionally, some homeowners insurance policies include a clause that requires you to purchase flood insurance if you live in a designated flood zone.
How Much Does Flood Insurance Cost Per Month?
The cost of flood insurance can vary greatly depending on several factors, including the amount of coverage you need, the type of policy you choose, and your location.
However, on average, flood insurance will cost you around $150 per month. This may seem like a lot, but it is important to remember that flood insurance can provide you with much-needed coverage in the event of a disaster.