Making the Right Call When It Comes to Canceling Your Flood Insurance

Flood Insurance, Home InsuranceThere’s no denying that flood insurance can be a heavy financial burden for those living here in Florida. However, does this mean that you should go ahead and cancel your plan in the hopes of saving a few bucks here and there? To find the right answer to this tricky question, let’s take a look at some of the factors that go into the decision and why getting rid of your plan might not be such a good idea in the long run.

The Ramifications of New Zoning

Depending on where you live, you might not have a choice in the matter when it comes to retaining coverage. As Wayne T. Price of Florida Today notes in his report on the Florida flood zone changes enacted by the Federal Emergency Management Association (FEMA) during the first half of 2014, areas formerly qualified as optional now sit firmly in mandatory coverage zones. This means that skipping out on coverage could cost you far more than the flood policy premium associated with this plan.

While it might not be the most enjoyable news to find out you’re now living in high-risk area, Price goes on to note that the prior flood maps more than 20 years old before the update, so it’s no surprise that things have changed over the course of several decades. Aside from the ramifications this new zoning could have on your bank account, having this current outlook in place and acquiring the appropriate coverage to go with it can shield you and your family from a future flood calamity.

Risk Versus Reward

At this point, the next logical question turns to what to do if you’re not in a high-risk area. Unfortunately, saying no to coverage in these locations also isn’t a wise choice. As the National Flood Insurance Program points out in its look at frequently asked questions regarding flood insurance, nearly 25 percent of all claims come from these low to moderate risk areas, providing ample reason to consider coverage regardless of what zone you call home. Simply put, the short-term rewards of lower monthly payments in non-mandatory regions doesn’t even come close to the potential costs of dealing with flood damage on your own.

Finding the Right Course of Action

Now that you’re up to speed with the flood zone changes and the risks associated with letting your policy lapse, the choice is clear when it comes to the right course of action – you need flood insurance if you live in Florida. Even if this type of coverage isn’t mandatory in your area, testing your luck on this front isn’t a wise course of action.

Before cancelling your policy, spend a few minutes reaching out to your insurance agent so you can discuss your options. In some cases, this expert can help you gain the best of both worlds by optimizing your costs and retaining the appropriate coverage at the same time. Either way, when the rain starts falling and doesn’t look like it’s going to stop anytime soon, you’ll be glad you have the right plan in place to protect your home.

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Posted in Home, Homeowners Insurance

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