Posted on: February 14th, 2012 by The Accel Group | 1 Comment
Tara Widdel,   CIC  CISR
Personal lines Manager, The Accel Group, Inc
In Eastern Iowa, flood protection is a pretty hot topic. Cedar Rapids was devastated by a massive flood on June 13th, 2008. We are still rebuilding from that flood and with that comes a lot of hard decisions and discussions on how to go about best rebuilding our city and protecting it from this type of disaster in the future.
About three weeks ago a reporter from the Cedar Rapids Gazette called me to get my opinion on flood protection, and asked if I thought there was merit to the idea expressed by some of our citizens that flood insurance will protect our community, so there isn’t a need for a formal flood protection system, or flood walls, to be installed along the river.
First and foremost, I am a true supporter of flood insurance, and what it can do to help our residents. Those who had flood insurance in 2008 (versus those that did not) would likely tell you how flood insurance tremendously helped them. With that said, flood insurance is not the answer indefinitely for flood protection in our community.
When it comes to relying solely on flood insurance for widespread protection of our residents’ properties and businesses, here are some reasons why flood insurance should not be relied upon as the sole protection against potential future flooding:
1.     For those that are not required by their mortgage lender to purchase flood insurance, even though premiums are very affordable if located outside the 100-year flood plain, many opt not to secure a flood policy. So we have many residents not covered with flood insurance because they are not required to have it.
2.     Even when a lender requires coverage for a property, typically they are only requiring that the value of the property that is covered by a loan have flood coverage, and not for the entire value of the property nor do they require contents coverage. If the full value of the home is not required, many times the property is under-insured because the property owner does not opt to fully cover the property for flood loss. This leaves a gap in coverage.
3.     If a property continuouslyfloods, in order for a policy to remain in force for future policy renewals, the NFIP may require additional measures to be taken to protect the home, which are usually costly.
This includes raising the structure above base flood elevation, relocating the structure, demolishing the structure or flood-proofing (for non-residential properties only). The flood policy may only assist with a small portion of this additional cost if at all.
4.     Because the cost of flooding across the US is incredibly expensive, the NFIP can only offer basic coverage under the flood policy. It’s not as comprehensive as a homeowners or business owners policy, so the flooded property will not be fully replaced by coverage from a flood policy. A flood policy is meant to get that property back up to a functioning level, not necessarily to replace it to the state it was prior to the loss.
Even with a flood protection wall/ system in place, flood insurance should still be considered. As you can see though, it is not the solution for all flood protection issues nor should it be the only solution considered. With weather patterns out of the ordinary, you never know when we could experience our next flood.
What many people in our area may not realize is that flood insurance can be extremely affordable if you are not in a special flood hazard area. For a residential home with a basement located outside the 100-year flood plain, $100,000 in building coverage, $40,000 contents coverage, the annual premium is $304. That equates to about $25 per month.  Also keep in mind, time is of the essence, there is typically a 30 day waiting period before a policy would activate. This 30 day waiting period is only waived if you are required by your lending institution to carry flood insurance.
At The Accel Group, we are able to write flood insurance policies through the National Flood Insurance Program (NFIP). A flood insurance policy can be written to cover the structure and contents of a home or business.  For more information about flood insurance, please contact the insurance professionals at The Accel Group. We are licensed to fully address your questions and to get you a flood insurance quote for your residential home, condo, rental unit (contents only), or business.
In June 2008 our city was devastated by flood waters, and to this day we’re rebuilding and will be for many years to come. I drive through the flood devastated areas of Cedar Rapids every day, and see firsthand the rubbish left behind, abandoned homes, structures barely standing up, windows and doors boarded shut, and here and there you find a nicely renovated rebuilt home or business that is striving to survive amongst the devastation surrounding it.
When you see the rebuilt properties it’s a sign of hope and perseverance, and there are more and more of these properties each day. The homes and businesses that came back after the flood of 2008 had to fight hard, and their fight is not over. I’m encouraged by the strength of our community and its residents, and am proud to say I’m from Cedar Rapids.