FOR INFORMATION: Mitch Wilson, OII – 614.228.1593; Christopher Thoms, ODNR – 614.265.6752; Robert Denhard, ODI – 614.644.3366

FLOOD INSURANCE PURCHASE WORTH INVESTIGATING

COLUMBUS–While many Ohioans are focusing on weather events during the Ohio Severe Weather Safety Awareness Week – March 21-27 – keep in mind that floods and flash floods are the two leading severe-weather related killers in the US. In Ohio, there have been 35 flood-related deaths during the past 10 years.

            "Individuals often overlook flood insurance coverage because they assume that the homeowners insurance policy provides coverage, and this simply is not the case,” said Daniel J. Kelso, president of the Ohio Insurance Institute (OII). “Flood insurance coverage is only available by purchasing a separate flood insurance policy," Kelso explained.

            The Ohio Department of Natural Resources (ODNR), Division of Water, which oversees the community eligibility function for the National Flood Insurance Program (NFIP) in the Buckeye state, advises that most property in flood-prone communities in Ohio is eligible for flood insurance coverage. Almost every type of roofed and walled structure can be insured. 

            "A flood insurance policy can be purchased from any licensed property insurance agent," explained Christopher Thoms, CFM, Environmental Specialist with the floodplain program office of ODNR's Division of Water. Thoms notes that 720 communities (634 municipalities and 86 counties for unincorporated areas), representing all parts of the state, currently participate in the NFIP program. 

            Thoms also points out that the cost of flood insurance varies, with the primary factor being the location of the property to be insured in relation to the flood hazard. Based on the number of flood insurance policies written, the average cost of an Ohio flood insurance policy in 2003 was $506. "If a residential property is not in a designated floodplain, the cost of purchasing flood insurance is much less. About one in four flood policies in Ohio are written for property not in designated floodplains," said Rich Slevin, Regional Manager - NFIP Bureau and Statistical Agent.  Owners of 1-4 unit residential buildings and townhouses not in areas designated as "special flood hazard areas" by the NFIP are likely candidates for the Preferred Risk Policy (PRP). Slevin points out that “major changes are being made to the PRP effective May 1, 2004, expanding the classes of business that are eligible.” If the property meets eligibility requirements, the median cost of a PRP – as of May 1, 2004 – will be $263 (with basement) and $233 (no basement) per year for $100,000 in structural coverage and $25,000 in contents coverage. 

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            "The worst time to realize you need more insurance in the form of flood coverage is after severe weather affects you and your family," Ohio Insurance Director Ann Womer Benjamin said. "It is important to make time to review your insurance policies with your family and agent with spring coming and before severe weather strikes. Usually, there is a 30-day waiting period from the time you purchase a flood insurance policy before coverage actually becomes effective."

            Typically, flood insurance covers damage caused by the general condition of flooding, meaning that it applies when a body of water overflows from above-normal cyclical levels. Most creeks, rivers and major bodies of water have predetermined flood level stages, however, the policy also covers surface water runoff that accumulates in low lying areas. Flood insurance does not cover damage to property directly caused by rain entering your home or business through openings in walls or the roof.  However, these types of losses may be covered by homeowners, renters or business insurance.

            "Also, many Ohioans experience flooded basements from backed-up sewers or inability of sump pumps to handle runoff from major torrential downpours," added Kelso. "Coverage for these types of perils is often available as an endorsement to an existing homeowners or business insurance policy."  

            The OII advises insurance consumers to take time to check the coverage and limitations of all their insurance policies so that when disaster strikes, the road to recovery may not be as costly and frustrating.

            The Ohio Insurance Institute is a trade association representing insurance companies and agent groups for the property/casualty insurance industry. A primary objective of the OII is to help Ohioans achieve a better understanding of insurance and related safety issues. 

            ODNR’s Division of Water, Floodplain Management Program Office is the state coordinating office for the National Flood Insurance Program. The Floodplain Management Office provides leadership to local governments, state agencies, and interested parties toward cooperative management of Ohio’s floodplains to ensure the reductions of flood damage and the recognition of the floodplain’s natural benefit. This mission is accomplished through technical assistance, public awareness, education, and development/protections standards.

            The Ohio Department of Insurance is committed to providing consumer protection through fair but vigilant regulation while promoting a competitive environment for insurers. The Department regulates and licenses approximately 1,800 insurance companies, nearly 166,000 agents, and more than 11,000 insurance agencies, and monitors the financial solvency of the insurance industry in Ohio.

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Web Resources:

Ohio Committee for Severe Weather Awareness

Flood Insurance consumer brochure

Floodplain management information