As our friends to the South continue with their efforts of cleaning up after Hurricanes Harvey and Irma and we follow Hurricane Maria closely, we are once again reminded about the huge role Flood Insurance can play in our lives.
FACT: Flooding is something that affects all regions, all states. In fact, nearly 90 per cent of all natural disasters include flooding.
Flood Insurance in Michigan
Flood Insurance is not like auto or home insurance; there are very specific rules that apply in each state. Don’t assume that if you were protected from flooding in a previous home insurance policy that you are protected once you made the move to Michigan.
In Michigan, we have three different categories that not only determine if you are eligible for flood insurance, but dictate if you MUST have flood insurance. Let’s take a look at some of the guidelines that determine your course of action:
- Only communities participating in the National Flood Insurance Program (NFIP) qualify for flood insurance at all
- Rates are set by the Federal Government, so there is no need to shop around (but it is still important to go with a broker who understands the specific rules for your community and state)
- Communities fall within one of three zones: low-risk; moderate-risk and high-risk
- Those in a high flood risk zone called a “Special Flood Hazard Area” (SFHA), MUST purchase & maintain flood insurance for the term of their mortgage
- Those in a low to moderate flood zone may be eligible for a preferred rate, which is usually a lower, more economical policy
- The exception to any policy is when the President declares a “Major Disaster,” in which case “Federal Disaster Assistance” is usually available to homeowners and renters in the form of a low interest loan.
To see what zone your community is in, and to determine if you are in a community that participates in the NFIP, call our team of experts at E&Y Agency. We know insurance and we know Michigan.
Call us at (248)362-1313 or fill in the form below… no commitment required to call, just an informational chat!
