New York
CNN
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Many victims of the massive storms now battering Southern California about are to be hit with one other heartbreak – discovering their insurance coverage received’t cowl the injury.
Story highlights
Lower than 1% of properties within the affected space have flood insurance coverage
LA has over 10 million residents however fewer than 15,000 flood insurance coverage insurance policies
Federal flood insurance coverage covers $250,000 price of harm
The standard owners’ coverage received’t cowl loss from flood injury. That’s coated by the National Flood Insurance Program, part of the Federal Emergency Administration Company. However in California, the place drought, not flooding, had been the extra widespread drawback till just lately, owners are about as ready for flood injury as hurricane-prone Florida residents are for earthquakes.
Knowledge from NFIP reveals solely 52,400 properties and companies are coated by flood insurance coverage within the eight Southern California counties declared a catastrophe space due to this storm. That’s lower than 1% of seven.7 million households within the affected space with protection. These counties have a mixed inhabitants of greater than 22.6 million folks, in response to the newest estimates from the Census Bureau.
Los Angeles County, with greater than 10 million residents, has solely 14,600 flood insurance coverage insurance policies in pressure. That’s roughly the identical quantity as Lee County, Florida, which incorporates Fort Myers, and has fewer than 1 million residents.
Even a few of these with flood insurance coverage may discover their insurance policies received’t cowl all of their losses. The federal insurance policies have a restrict of masking solely $250,000 in injury to buildings and $100,000 to the house’s contents. These limits will be rapidly exceeded, particularly in Southern California. Householders can purchase extra flood insurance coverage protection to match the bounds of protection on their owners insurance policies, however many don’t trouble to take action.
Flood insurance coverage will be required by mortgage lenders on properties in federally designated flood plains. But when an space just isn’t judged to be liable to flooding, there’s an excellent probability that owners won’t have bothered to pay further for the flood protection.
That may be very true for owners in California, who’re coping with among the many highest homeowners’ insurance premiums within the nation, because of a mixture of the excessive value of rebuilding and the chance from different pure disasters, comparable to wild fires. A number of main nationwide property and casualty insurers have stopped writing homeowners’ policies in California, driving up costs.
Federal flood insurance coverage is usually accessible to owners and enterprise all through america and its territories.
The NFIP estimates that greater than 40% of NFIP flood insurance coverage claims come from outdoors the high-risk flood zones. Injury in these non-flood inclined areas are probably even greater given the decrease frequency of protection.