Commercial Flood Insurance – Do You Need it for Your Business?
The need for flood insurance for your business
Flood Insurance- You need to consider the increased risk of flooding
When thinking about flood insurance for your business, you may think if you are not by a body of water you don’t need it. But think again! Fill out the enclosed form to get a flood insurance quote today.
Recently floods in Vermont, Oklahoma and Kentucky have proven otherwise. These are landlock states that experienced heavy rainfall that led to flooding and widespread devastation.
According to a report from the First Street Foundation, intense rain events, like atmospheric rivers and torrential thunderstorms are making the idea of a “1-in 100- Year flood event” obsolete.
The Northeast is one of the areas that the First Street Foundation is most concerned. The rainfall depths for a 1-in-100-year event could happen far more frequently and they estimate it could be ever 5-10 years.
We used to worry about flooding only when there was a hurricane. Now more flooding is being caused by intense rainfall, which causes inland flooding.
Flooding can happen anywhere and it’s a year-round risk. Poor drainage, summer storms, melting snow, flash rains, nearby construction and broken water mains can all lead to damage and loss of property.
Just 1 inch of floodwater can cause up to $25,000 worth of damage, according to the National Flood Insurance Program
What is a flood?
According to NFIP, a flood is “a general and temporary condition of partial or complete inundation of two or more acres of normally dry land area or of two or more properties (at least one of which is your property) due to:
- Overflow of inland or tidal waters
- Unusual and rapid accumulation or runoff of surface waters from any source
- Collapse or subsidence of land along the shore of a lake or similar body of water as a result of erosion or undermining caused by waves or currents of water exceeding anticipated cyclical level that result in a flood as defined above.
Most commercial property insurance does not cover Flood damage. To protect your building or personal property you would need to have a separate flood policy.
Floods are one of the most common and expensive natural disasters that can affect every region and state. Other reasons you may want to consider commercial flood insurance:
Over 20% of flood claims come from properties outside high-risk flood zones.
Wildfires can change the landscape and ground conditions in your area, so future rainfall can cause flash flooding.
Storms aren’t the sole cause of flooding.
A broken dam or levee or new building development that changes the flow of water in your area are just a few ways that can trigger a flood.
Some commercial property policies even exclude water backup from sump pumps and drains if it is caused by a flood.
It is important to purchase a separate flood policy to have this protection.
When it comes to flood insurance you have a few options:
- NFIP offers coverage up to $500,000 for the building and $500,000 for contents. This is the government program.
- Excess flood policies can add additional limits over the NFIP.
- There are also private flood markets that have higher limits and broader coverages, some include business income due to the flood as well.
There is a 30 day wait before flood coverage would be active after the application is completed. You cannot wait for the rain to fall to get your flood insurance
Let me ask you a hypothetical question:
“Would your business re-open after a flood?” (Forget, for a moment, the odds of a flood.)
Nationwide 40% of small businesses DO NOT re-open, according to federal government statistics.
The reason businesses fail to get on their feet again is there is no FLOOD insurance financing the recovery.
I can’t emphasize this enough: only a flood insurance policy covers damage to buildings and contents caused by a flood. Flood can be rising tidal waters, or it can be a water main or it can be storm runoff that affects 2 or more adjoining properties.
Your business doesn’t have to be washed away in a tidal storm to put the “kabash” on your future.
Only a few inches of water will cause you a major financial setback. In fact, the average flood claim to a covered business was more than $75,000 in 2007 thru 2011.
Commercial flood insurance is different than flood insurance for a house. Through the National Flood Insurance Plan (NFIP) you can buy up to $500,000 of building coverage and up to $500,000 for business property.
Remember Superstorm Sandy?
Many of the businesses affected where those far from the coast and did not have flood insurance. We do not want to see your business suffer the same fate as those businesses.
Contact Huff Insurance
Don’t forget that we are here to help you stay in business after a claim. We can’t do much for you after a flood, though, unless you’ve got the coverage.
By the way, it’s not as expensive as you might think.
Call us at 410-647-1111 or fill out hte quote request form on this page and we will be glad to help you protect your business.